The intense bear market the entire crypto market is currently in, has caused several crypto related companies, especially bitcoin mining firms to shut down operations. However, some were ordered to shut down as a result of their actions. A case in point is that of bitcoin mining startup — Envion AG which raised about $100 million in an initial coin offering (ICO) in January, which has been ordered to close down by a court in Switzerland.
Envion AG Lacks Proper Governance
According to the court papers, Envion AG which ran into an early halt, reportedly lacks a functional board of directors. To further prove how bad the situation has gotten, the two founding partners of the firm, Michael Luckow and Matthias Woestmann were said to be coming in and out of the courtroom on a regular basis, due to the lawsuit brought against each other. The court papers made it known that the duo initially sued each other over allegations of subterfuge.
In light of the constant suing, Woestmann, who was the company’s board chairman has resigned. He made it known that Luckow has mined more coins than agreed upon. As a result of this capital increase, Luckow’s shares in the company became diluted.
According to the report detailing the accusations, is was stated that:
“In the capital increase, Woestmann allegedly issued actual shares, rather than tokens, effectively diluting the 81percent stake of Luckow and his partners to 31 percent.”
As a result of this consistent unrest, the cantonal court in Zug — Switzerland’s cryptocurrency haven — has taken it upon itself to issue a shutdown order against the company. The court wants the company to seize operation and have all its asset liquidated. The court stated the lack of a “functional board of directors and the complete lack of any auditing function.” has its reason for ordering the shutdown of the company.
It has also been established that the New Zealand financial regulators are also stepping in, to investigate the company.