Lossless lottery, Pool Together has started Sale of NFT Raise funds for a legal defense in New York yesterday against a class action filed by a cryptocurrency critic software engineer.
Important reason: This is intended to test the question of whether the author can create something, release it on the blockchain, and claim that it doesn’t really control it anymore.
what happened: Joseph Kent, a former staff member of the presidential election of plaintiff Elizabeth Warren, bought a ticket in the Pool Together lottery to sue its creator, the compound (lending platform and business partner) and investors. Illegal lottery.His case was filed In January In New York.
- In his complaint, Kent’s lawyer said, “A cryptocurrency ecosystem that requires heavy use of electricity will accelerate climate change, allowing people to circumvent financial regulations and deceive consumers. I am seriously concerned about what I am doing. “
- He wants double the legal fees and asks everyone to put money in it and get double the money back.
- Kent argues that while PoolTogether delegates control of the protocol to the owner of the POOL token, in fact, the creator of PoolTogether and its investors have enough POOL to control it anyway. doing.
How to use: Pool Together is a working savings game Some kind Except like a lottery, anyone can always get back the money they put in. Everyone’s deposits are used in the DeFi protocol to earn interest that acts as a lottery prize.
- In other words, users give up interest on their money and get a chance to earn interest on everyone’s money.
- Currently, various pools are awarded a daily prize of $ 7,180.
- The WebsiteIt’s important to note that it’s a way to access the Ethereum and Polygon (Ethereum sidechain) protocols, but even if it goes down, you can still access PoolTogether.
- Similarly, if PoolTogether, Inc. shuts down, PoolTogether will continue to run.
Zoom out: PoolTogether, Inc. does not benefit or benefit from the PoolTogether protocol. The actual game manages the owner of the POOL token.
- DeFi companies like PoolTogether, Inc. have different business models. They make things, make governance tokens to control them, release things, distribute tokens, but keep some of the tokens for themselves.
- The theory here is that when things become popular enough, the value of tokens will increase and all work will be valuable.
This model Has run into problems in practice, but it works fine for some projects.
- The POOL token was launched in early 2021 for about $ 26. These days it’s trading for about $ 1.
In subsequent filing In this case, Kent’s lawyers Charles Gerstein and Jamie Crooks talk about how the DeFi protocol doesn’t work the way ordinary people understand how a business works.
“The defendant here is the general partnership of this shared company, whether it is drafting the protocol, running the protocol, collecting money, distributing tickets. Who will be responsible if not responsible? The only answer is “nobody”. That can’t be right. “
Yes, but: Kent raises the issue that has always plagued DeFi — is the decentralization claim quite true? Governance tokens are typically distributed in large quantities to investors and founders, and most of the others are distributed to users.
- That said, many users just sell them. It will not be difficult for well-financed investors to bring them to the surface.
- It’s also not difficult to hide how much control you actually have.
Our thought bubble: Pool Together is really fun to save money. Real gamblers love DeFi, but Pool Together isn’t their choice.
- That said, as Kent points out, there are products on the market similar to Pool Together that offer better insurance against loss of principal.
What they are saying: In response to his complaint, Paul Hastings’ Pool Together lawyer said, “Plaintiffs attempted to create a standing position by voluntarily injuring them by depositing cryptocurrencies in a savings protocol. I admit it.
- According to his own account, Kent is at risk of about $ 12 at Pool Together (although he spent about $ 400 on gas charges to make these deposits).
What we are seeing: PoolTogether, Inc. claims that Kent has already agreed to binding arbitration when using the website.
Conclusion: At the time of this writing, NFT sales of the purple bird Pool Together named “Pooly” raised 192.4 ETH ($ 347,000) towards the 769 ETH target.
