Cryptsy
| Industry | Cryptocurrency exchange |
| Founded | 20 May 2013 |
| Defunct | 2016 (receivership; trading earlier halted) |
| Headquarters | Delray Beach, Florida, United States |
Cryptsy was a Florida-based cryptocurrency exchange operated by Project Investors, Inc., with Paul Vernon as CEO. It opened on 20 May 2013 and listed bitcoin alongside many altcoins. == Closure == Customer withdrawal problems worsened for months before withdrawals and trading were suspended entirely. CoinDesk reported that prior to shutdown Cryptsy said it had outstanding customer liabilities of nearly $10 million in bitcoin, and that a class-action lawsuit was filed in January 2016. Vernon told CoinDesk in January that he was traveling in China.[1]
Receivership
CoinDesk reported on 4 April 2016 that a Florida court had frozen Cryptsy assets and placed the exchange under receivership, with court-appointed receiver James Sallah selected after a request by plaintiffs in the class action. Court documents described by CoinDesk gave Sallah administrative control over the assets and management of Project Investors. Approval followed a 28 March hearing. The order quoted by CoinDesk suspended officers' and directors' powers and directed the receiver to assume and control Cryptsy operations and preserve claims. Vernon had not been served and had not responded in court at the time of that report.[1]
Default judgment
CoinDesk reported on 28 July 2017 that U.S. District Judge Kenneth Marra entered a default judgment on 27 July 2017 holding Cryptsy CEO Paul Vernon liable to the plaintiff class for $8.2 million. CoinDesk quoted the order as further declaring that 11,325.0961 BTC stolen from Cryptsy customers on 29 July 2014 were property of the plaintiff class and subject to the judgment. Vernon did not respond to the allegations in court, which led to the default judgment; CoinDesk noted he was believed to be somewhere in Asia and had denied stealing user funds.[2] Figures above are as reported by CoinDesk quoting the court order.
CoinDesk reported that Coinbase later settled a class-action matter involving former Cryptsy users.