3 - 4 minute read
Crypto mining company Blockware Solutions is facing a lawsuit from Faes & Company, a London-based firm, over allegations of misrepresentation and inadequate power access for its miners. The plaintiff claims losses of $250,000 and is seeking compensatory and punitive damages.
According to the complaint, the parties entered into a contract in October 2021 for Faes to purchase $525,000 worth of Bitcoin miners and related hosting services from Blockware. The agreement stated that Blockware would host the miners at one of its own server facilities, charging a monthly hosting fee and energy costs. However, the complaint alleges that Blockware “did not actually own or operate a facility to host the miners and was not capable of doing so reliably.” Additionally, the complaint claims that any third-party facilities used by Blockware to host and manage the miners lacked reliable power, leading to regular interruptions and downtime.
The current difficulty epoch is just over the halfway point and we are on pace for a -9.5% downward difficulty adjustment.— Blockware Solutions (@BlockwareTeam) November 29, 2022
This will provide well earned relief to surviving miners⛏️#Bitcoin pic.twitter.com/oVhaVHpCA7
Faes also alleges that Blockware hosts and updates a public “status page” showing consistent high uptime at its facilities, including the Pennsylvania facility where Faes’ miners have been hosted, despite the miners experiencing numerous problems and extended periods of downtime. The complaint states that there were approximately 50 days of extended power curtailment at the Pennsylvania facility during September and October, despite the status page showing “consistent 100% uptime for the preceding 90 days.”
“Problems with downtime began approximately two days after Faes’ miners first came online and have persisted throughout 2022, resulting in numerous complaints and support tickets by Faes. Despite these problems, Blockware hosts and updates a public “status page” that shows persistent high uptime at its facilities, including the Pennsylvania facility where Faes’ miners have been hosted, showing consistent 100% uptime for the preceding 90 days.”
The lawsuit comes at a difficult time for the crypto mining industry, which has been hit hard by the current bear market and rising energy costs. According to Hashrate Index, the top 10 Bitcoin mining debtors owe a total of $2.6 billion. Blockware Solutions has not yet commented on the lawsuit.