Pro-XRP Legal Heavyweight Slaps Linqto Founder with Lawsuit Over Shady Unlicensed Crypto Stock Deals

Crypto's legal drama escalates as a prominent XRP advocate takes aim at Linqto's leadership.

The Hammer Drops

A high-profile attorney known for defending Ripple’s XRP has filed suit against the founder of private investment platform Linqto—alleging illegal sales of crypto-linked securities. No licenses? No mercy.

Regulators’ Blind Spot

The lawsuit exposes yet another gray area where crypto and traditional finance collide. When platforms skirt SEC rules, someone eventually pays—usually the investors. But hey, what’s a little regulatory arbitrage between friends?

Crypto’s Legal Reckoning Continues

Another day, another courtroom showdown. As the industry matures, expect more scalpels—or sledgehammers—aimed at loose compliance. Pro tip: maybe check those licenses before cashing those checks.

John Deaton’s Linqto Lawsuit

John Deaton is a prominent crypto lawyer and XRP advocate, participating in the SEC v Ripple case and challenging Elizabeth Warren’s Senate seat last year.

Today, however, Deaton is taking a case of indirect interest to the crypto industry, as he filed a lawsuit against Linqto for fraud in selling Web3-related company stocks.

I’ll hold a spaces on X this evening to discuss. The Complaint will be posted on @CryptoLawUS. Law firms who file securities class action lawsuits were going to file once they learned the facts. Now that I’ve filed, if there is any settlement of any kind I can fight for IT ALL to… https://t.co/rIbwQ3GBSK

Linqto is an investment platform, but this case is nonetheless particularly relevant to the crypto community. Deaton alleges that Sarris used a variety of illegal practices to sell stock in Ripple, Kraken, Uphold, and several other crypto firms.

So, what were these alleged violations? The lawsuit claims that Linqto marked up crypto stocks by as much as 60%, scalping customers who wished to invest in Ripple or other companies.

Deaton also accused the firm of creating misleading exemptions, employing illegal sales tactics, and knowingly violating SEC/FINRA regulations to do this.

Just yesterday, Linqto filed for bankruptcy, so Deaton’s lawsuit specifically is targeting founder/CEO William Sarris. He filed this MOVE as a class-action lawsuit, aiming to recoup losses for thousands of retail investors.

By going after Sarris, Deaton can avoid any bankruptcy protections that might shield Linqto, maximizing the chances of recovering user funds.

Naturally, the crypto community reacted with great enthusiasm. Several firms promoted Linqto to the XRP fan community, and this lawsuit might help expose any criminal behavior.

Thanks to Deaton’s reputation as a pro-crypto litigator, observers are expecting positive outcomes.

Still, this whole incident highlights the need for sensible pro-crypto regulation and consumer protection measures. Lawsuits like the Linqto case might help recover lost assets, but it’s better to prevent criminal fraud ahead of time.