EOS/USD: Investors sue EOS for providing misleading information

EOS is the 9th largest digital asset with the current market capitalization of $2.4 billion and an average daily trading volume of $3.0 billion. The coin has lost over 1% since the beginning of the day and 3% on a day-to-day basis. While EOS is moving in sync with the market, the downside momentum is intensified by the recent class action law suit filed against Block.One, the company behind EOS blockchain.

Investors are angry with Block.One

Investors in the EOS file a class action lawsuit against Block.One, its CEO Brendan Blumer and CTO Daniel Larimer. They accuse the company and its top managers of performing unregistered securities sale and providing investors with false and misleading information about the project. Block.one raised $4.2 billion during one-year long ICO that took place from 2017 to 2018.
 
The complaint says:

To drive the demand for and increase profit from the sales of EOS Securities, Defendants further violated the securities laws by making materially false and misleading statements about EOS, which artificially inflated the prices for the EOS Securities and damaged unsuspecting investors.

Also, the investors believe that Block.one pumped EOS price by way of the aggressive marketing campaign and targeted the US-based investors. They claim that EOS blockchain would surpass all other existing blockchains and called it Ethereum on steroids; however, the project failed on those claims.

Recently, the FXStreet reported that Vitalik Buterin made several positive comments about EOS.

EOS/USD: Technical picture

At the time of writing, EOS/USD is changing hands at $2.63, off the intraday low of $2.57. The coin broke below local support created by 1-hour SMA50 (currently at $2.65) and the short-term upside trendline. Now this area serves as resistance and separates the price from an extended recovery. 

On the upside, a sustainable move above this area will bring $2.70 back into focus. It is followed by $2.80 (the upper boundary of the previous consolidation channel), while the major bullish aim is created by $3.00.

EOS/USD 1-hour chart