- Archblock’s co-founder files lawsuit over forced exit.
- TrueUSD’s journey from tokenization to blockchain lending.
- The power struggle at Archblock impacts the stablecoin industry.
Daniel Jaiyong, the co-founder of Archblock, has filed a lawsuit against his former colleagues. Jaiyong, a key figure behind the creation of the stablecoin TrueUSD, accuses his ex-associates of forcing him out of the company in 2020 for their gains, leaving investors in a precarious situation.
The legal proceedings revolve around the circumstances that led to the ousting of Jaiyong from Archblock, a business he established jointly with Rafael Cosman. The legal action uncovers that TrustLabs, a branch of Archblock, distributed investment documents termed “simple agreements for future tokens,” or SAFTs, from 2017 to 2019. These documents were planned to generate capital to create a tokenization platform. As a result, TrustLabs accumulated $35M via the SAFTs, culminating in the launch of TrueUSD and TRU tokens in 2018.
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A Shift in Direction and a Fall from Grace
However, the lawsuit alleges that Cosman began steering the company away from the tokenization platform and towards other profit avenues, such as the TrueRewards program, later rebranded as TrueFi. Jaiyong reportedly grew concerned that TrustLabs’ new direction deviated significantly from what they had initially promised investors, potentially violating securities laws as the venture morphed into something resembling a blockchain lender.
Jaiyong, in his quest for transparency, wanted to disclose the pivot to investors and offer a refund option. However, Cosman and other senior staff were allegedly hesitant about losing their lucrative positions if they revealed the shift in direction to investors.
In July 2020, Cosman, in collaboration with TrustLabs’ financial chief, Alex de Lorraine, and board advisor Tom Shields, facilitated a ballot that led to the removal of Jaiyong from his position as CEO. Cosman was subsequently appointed to fill the vacant role.
Jaiyong’s Unsuccessful Bid to Sell TrueUSD
While Jaiyong was being removed from his position, he was said to have been in discussions with billionaire entrepreneur Justin Sun, exploring the potential sale of TrueUSD to Sun’s blockchain firm, Tron. In the end, TrueUSD was acquired by a consortium known as Techteryx, located in the British Virgin Islands.
Despite the change in ownership, Archblock continued to oversee the operations of TrueUSD. Recently, Techteryx announced its takeover of offshore operations and competencies related to TrueUSD on the same day the lawsuit was filed.
Regrettably, Jaiyong was ousted from Archblock while the talks with Tron were still ongoing, rendering him unable to represent the interests of the SAFT investors. However, Archblock refuted the allegations made in the lawsuit, asserting that Jaiyong’s claims lacked merit.
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In conclusion, this lawsuit serves as a stark reminder of the power struggles and profit-driven decisions that can occur within the world of blockchain and cryptocurrency. As the case unfolds, it will be interesting to see how it impacts the future of Archblock and the stablecoin industry.