Cyber-currency exchange site named in class action

Posted on: January 25th, 2018 by Steve Larson

On January 10, 2018, a complaint was filed on behalf of a putative class of subscribers to a defunct digital currency exchange called Vircurex in federal court in Colorado. Vircurex subscriber, Timothy Shaw, alleges that the Beijing-based company unlawfully froze subscribers’ accounts when it disabled the ability to withdraw Bitcoin, Litecoin, Terracoin and Feathercoin in 2014.

Vircurex launched in October 2011 as a virtual exchange where account holders could deposit US Dollars and Euros to buy, sell and exchange digital currencies.

The defendant website experienced a series of hacks in 2013 leading to its near insolvency. In 2014, Vircurex announced that it was forced to freeze subscribers’ accounts. According to the complaint, Vircurex assured subscribers that they would be repaid frozen funds out of the company’s reserve funds and future profits. However, since the freeze, subscribers have not received any compensation.

The complaint names Vircurex’s founder, Andreas Eckert, along with the company as an entity and an unnamed “John Doe” Chinese national as defendants in the suit. The complaint alleges claims for breach of contract, conversion, constructive fraud and unjust enrichment.

The case is Timothy Shaw v. Vircurex, Andreas Eckert AKA Kumala, and John Doe, Case No.: C.A. No. 1:18-cv-00067.