Payward, the parent company of crypto exchange Kraken, has filed a lawsuit alleging $25 million in crypto custody fraud against Etana and the firm’s CEO, according to the complaint. The allegations center on claims that client funds were misused, commingled, and concealed as part of a “Ponzi-like” scheme that unraveled amid a liquidity crisis.
Fraud Allegations
The lawsuit claims that Etana engaged in improper handling of client cryptocurrency assets held in custody. According to Payward’s allegations, the scheme involved the concealment and commingling of funds, ultimately resulting in a liquidity crisis that exposed the arrangement.
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