HitBTC, currently the fifth-largest cryptocurrency exchange by trading volume, faces legal action from a blockchain loan company Karma Group. The action was filed in relation to a payment Karma made to HitBTC for its support and services. Karma paid over 527.01 ETH, or over $307,000 for service which has, since this report, not been refunded to Karma.
The package of the services promised to the Karma Group included implementation of Blockchain, the listing of two trade pairs (BTC and ETH), and introducing of an additional trading pair to the United States dollar token (USDT). The Karma Group says that they were promised by HitBTC to include their tokens in the HitBTC listing by April 20th.
The Karma Group also said that they provided all the necessary information to the exchange regarding the blockade based on the bitShares technology. On March 29, the Karma team also re-notified HitBTC that the KRM tokens are not the “custom” tokens of the ERC-20 standards. The representatives of Karma Group said that the team offered all kinds of technical assistance, but HitBTC rejected them every time.
HitBTC ceased all communications for 5 days with Karma team, post-deadline. Further, the explanation was given that they were not informed about the fact that KRM is not an ERC-20 token. Karma further requested for refund of the payment made, but no proper reply came from the exchange up until now.
When asked about the lawsuit, Karma Founder, George Goognin said,
“The Karma team stands for transparency and a high level of business ethics. The parents of crypto-economics defended freedom, but total freedom always comes with total responsibility. We are sure that breach of the basic principles, especially by the big players of the market, is unacceptable. So we decided to start this action.”