Meteora Crypto Exchange Hit with Class Action Lawsuit Over Alleged Fraud Scheme

Meteora crypto exchange faces a class action lawsuit over a $69 million fraud involving the $M3M3 token. Investors allege manipulation of the token’s launch and market price, asserting violations of federal securities laws. The lawsuit seeks compensatory damages and restitution for affected investors, highlighting severe misrepresentation and coordination among the defendants.

Meteora, a crypto exchange, faces a class action lawsuit due to allegations of a $69 million fraud involving a digital asset token scheme. Investors have targeted Meteora, its former CEO Benjamin Chow, and venture capital firm Kelsier Labs in their lawsuit, alleging manipulation of the $M3M3 token’s launch and market price to defraud investors. The lawsuit includes claims of fraud and violations of federal securities laws, reflecting serious legal implications for the defendants.

The plaintiffs, Jonathan Clarke and Rodrigo Ferreira Da Cruz Vogt, accuse the defendants of launching the M3M3 investment platform in December 2024, marketed as a solution to market volatility that would benefit investors. The $M3M3 token was promoted as a reliable investment, while the true agreement among defendants was allegedly concealed.

It is claimed that insiders managed to acquire 95% of the token’s supply shortly after its launch, creating an artificial market capitalisation. The defendants allegedly sold these tokens at inflated prices, leading to significant losses for unsuspecting investors soon after the launch. The lawsuit argues that this represents a clear exploitation of retail investors relying on the deceitfully marketed token’s value.

Throughout late 2024 into early 2025, the defendants reportedly undertook efforts to restore investor confidence, yet these resulted in temporary price increases followed by steep declines. The investors are contending that had the defendants adhered to federal securities registration and disclosure mandates, they would not have sustained losses.

The lawsuit demands both compensatory and punitive damages. Plaintiffs seek restitution of the $69 million allegedly gained through fraudulent means, aiming to secure justice for the impacted group of non-insider investors.