Aussie-Owned Crypto Casino Stake Sued For $580M
Stake.com is the world’s largest cryptocurrency and bitcoin casino. Australian cryptocurrency king Ed Craven is one of the company’s founders, but he is on the hook for $580 million after a former associate launched legal proceedings in the United States.
Craven recently purchased Melbourne’s most expensive house, forking out $80 million. However, Craven should have earmarked that vast sum of money for the upcoming lawsuit. Craven purchased 29-31 St Georges Road for $80,000,088 despite its derelict condition. He has a habit of building from the ground up, as evident by Stake’s creation.
Stake founders Craven and Bijan Tehrani dismissed the legal action, calling it provably false. A former associate alleges Craven and Tehrani cut him out of the successful business. He wants compensation. Christopher Freeman of Florida launched civil court action in New York where he seeks US$400 million ($580 million) in punitive damages. Freeman claims the Australian entrepreneurs mislead him about his initial investment.
Craven and Tehrani turned Stake into an operation worth an estimated $1 billion. The online casino uses cryptocurrency for its casino games and online pokies, making it extremely popular with players living in jurisdictions where playing high roller casino online proves troublesome.
Stake Co-Founders Are Long-Running Friends
Court papers show Freeman, Craven, and Tehrani enjoyed a long-running friendship. Freeman and Tehrani met in primary school, with Craven coming into the picture when the trio went to university.
Craven and Tehrani set up a casino business with Craven in 2013. Freeman held 20% equity in Primedice, with Craven and Tehrani each owning 40%, reflecting their initial investments. Freeman claims his Stake reduced to 14% within nine months in order to reward other senior members of the casino’s development team.
Business-savvy Freeman saw a gap in the online casino market when cryptocurrency became mainstream. He raised the idea with his partners, but neither Craven nor Tehrani showed any interest. However, Craven and Tehrani had a change of heart and launched Stake. They dissuaded Freeman from joining the new operation by stating he must move to Australia and that the casino and sports betting operation would only deal in fiat-based currencies.
Freeman’s Lawyers Speak Out
Lawyers representing Freeman in the $580 million lawsuit spoke out as to why their client wants his pound of flesh.
“Freeman, who was committed to and comfortable with online gambling concepts, believed a fiat money casino was the wrong direction to go. Online gaming facilitated by fiat is a widespread, big business. He reasoned it was highly competitive and presented personal risks, which he was not prepared to accept, and he did not want to be forced to move to Australia to pursue a fiat-based gambling business.”
“Later, when Stake launched as a virtual casino which included a competing online dice game and many other features Freeman had proposed and helped design, Tehrani and Craven affirmatively tried to assuage Freeman’s dismay at having been mislead by affirming that he still retained his Stake in Primedice. Eventually, Freeman’s access to the Primedice account was blocked and never returned.”
Craven and Tehrani have not spoken out about the lawsuit. However, Stake issued a statement that states Freeman’s claims are false.
“The complaint filed by Chris Freeman contains allegations that are intentionally inconsistent, intentionally misleading, and provably false.”
Stake also claims Freeman has no claim to the money he says the company owes him. The company plans to fight the lawsuit and is confident the courts will rule in its favour.
The Melbourne-based gambling site exploded in recent years. In addition to the increased popularity of cryptocurrency, Stake spent vast sums of money marketing its product. For one, it is the principal shirt sponsor of the English Premier League team Everton. Also, global superstar Drake is the site’s leading brand ambassador.
