Ava Labs Founder Receives $3M Payout in Crypto Defamation Suit

The CEO and founder, Ava Labs, Emin Gun Sirer, won millions in a defamation suit against an influencer who called him out, accusing him of being part of a Turkish terrorist group.

The accusations which led to a lawsuit, stemmed from claims made in February 2021, in a Youtube video by the crypto influencer Emre Aksoy, telling his large Youtube followers, that Sirer was part of an Islamist group called Fethullah Terrorist Organisation (FETO).

Ava Labs CEO the cost of the defamation was in the millions and crashed the price of AVAX at the time. He further expressed that the AVAX token plummeted 57% from its initial high of $55.51 on February 11 to $23.85 by the end of the month.

What really went Wrong?

Other sources said that Aksoy was paid to promote a rival product of Ava Labs. According to the suit, this was what led to Ava Labs pursuing defamation claims.

United States judge Beth Bloom when speaking to Law360 said that the testimony from Sirer shows that he suffered a great dent in reputation among other things. therefore he is entitled to $750,000 in general damage to his reputation.

According to the judge:

Due to his legitimate worry that he would be detained upon entry by Turkish authorities as a result of the defendant’s accusations that he was a member of FET, [the] Plaintiff felt anxiety and terror throughout his numerous journeys to Turkey.”

Additionally, Sirer received $2 million in punitive damages to “deter the kind of malicious behavior perpetrated by the defendant” and $300,000 in “special damages for his increased security costs” from Bloom.

Last week, Sirer said during a blockchain conference on Roosevelt Island in New York City that the sector wouldn’t be considered mature until regulators could read and audit code.

His remarks coincide with a wider crackdown on cryptocurrencies in the United States, where regulators have enacted regulations banning everything from staking to stablecoins.

What Siren meant by “Regulators could read and Audit Code”

Recently, there is an increased war mounted on crypto by the United States Securities and Exchange Commission which has been raising concerns.

The SEC is under scrutiny for failing to provide crypto users and investors with the information that they need.

According to a publication by Web3 venture capital firm Paradigm, it claimed that SEC Chair Gary Gensler’s attempt to brute force crypto assets that may not even constitute securities into an ill-fitting disclosure framework is bad policy.

This new policy therefor denies the claim that SEC offers crypto enthusiasts a viable path to compliance.

Key Takeaway

• Ava Labs CEO wins $3m in a defamation suit.
• The defamation claims that Sirer belongs to a Turkish terrorist group
• Aksoy made this statement in a ploy to sell and advertise a rival product.

Final Note

While is it not a new story that SEC is clamping down on misconduct in the crypto space, it is also necessary for the security agency to be transparent enough for crypto investors to believe their claim on drafting out a compliance, transparent and better management path.