Report: XLM Security Decision ‘Bad News’ For Paul
As Fortune reported on June 20, the deal between the two companies is thought to be worth around $500 million — which will be transferred in Stellar’s lumen (XLM) tokens. “One source familiar with the deal said it is likely in response to the heated battle for top developers between crypto companies,” the publication added about the likely impetus for the acquisition.
At the same time, an investigative blog post published June 16 suggested Paul actively engaged in XLM buying and advised others to do so based on knowledge he had about the impending deal. The allegations, compiled by trader and commentator BambouClub from private messages between Paul, trading analyst Kazonomics and other sources, could be “bad news” for him — especially if XLM is soon classified as a security.
‘Get Out Of Jail Card’
US regulators have sought to clamp down on any activities involving trading or improper handling of tokens which constitute securities this year. Yet, the pace at which such tokens are classified remains slow. “But until that matter is settled, whether XLM is a security, it seems that Ari Paul has a ‘get out of jail’ card,” BambouClub summarizes.
BambouClub’s suspicions center on a specific private message between Paul and Kazonomics from May. “I wasn’t implying that you pump stuff,” Paul wrote about Kazonomics’ analysis activities, continuing:
Rather, it’s standard to establish a position and then share that info with friends. For example, if I thought XLM was a great buy because of the Chain announcement, I would first buy it then tell you.
At the time, no announcement had arisen about Stellar and Chain.
The drama is not the first time that cryptocurrency industry figures have been hit with insider trading scandals. Perhaps most infamously, the US’ largest exchange and wallet provider Coinbase conducted a lengthy internal audit beginning late last year when allegations emerged that officials traded altcoin Bitcoin Cash prior to it debuting on the popular platform.
What do you think about Ari Paul and the Chain acquisition? Let us know in the comments section below!
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The post Stellar Buys Chain For ‘$500M’ — But Insider Trading Suspicions Remain appeared first on Bitcoinist.com.
Written by Wilma Woo @ http://bitcoinist.com/stellar-buys-chain-500m-insider-trading-suspicions-remain/ June 21, 2018 Wilma Woo