Crypto Drama Unfolds: Former Employees File Major Lawsuit Against Theta Coin

The blockchain world's latest courtroom clash just dropped—and it's got former Theta employees pointing fingers at the project's leadership.

Behind the Decentralized Curtain

Forget the whitepaper promises and roadmap hype. This lawsuit pulls back the velvet rope on what former staffers claim was happening backstage. Allegations range from contractual disputes to governance grievances, painting a picture that's far from the decentralized utopia marketed to investors.

The Numbers Game

While the legal documents don't disclose exact settlement figures, the 'major' classification suggests stakes are high—high enough to make even seasoned crypto lawyers raise an eyebrow. It's the kind of drama that typically precedes a price dip, followed by a 'nothing to see here' tweetstorm from official accounts.

Community on Watch

Theta's dedicated holders now face the classic crypto investor's dilemma: dismiss this as FUD or dig deeper into what the lawsuit might reveal about the project's operational health. Meanwhile, rival projects are probably subtly retweeting the news—the decentralized version of schadenfreude.

Regulatory Ripples

Every lawsuit like this becomes another data point for regulators crafting the next round of 'protective' legislation. The plaintiff's arguments could inadvertently blueprint what future crypto employment contracts must avoid—or what disgruntled employees might exploit next.

So while Theta's technology continues streaming video somewhere, its human drama takes center stage in court. Another reminder that in crypto, the most complex code often isn't in the blockchain, but in the legal agreements governing it—and that's one protocol that never seems to get upgraded.

For a long time, news regarding lawsuits in the cryptocurrency world typically followed the theme of “case dismissed, investigation ended.” However, a new fraud case emerged today, targeting one of the popular altcoins. This lawsuit is particularly significant as it is brought forward by former employees of the company, raising crucial allegations.

Theta Coin Lawsuit

Two former employees of Theta Labs Inc. have filed a lawsuit in the California Superior Court, Los Angeles County, with serious accusations. According to the claims, Mitchell Liu, the CEO of Theta Labs for the past few years, has been engaging in speculation to inflate the value of crypto products. To enhance his project’s visibility, Liu allegedly formed substantial partnerships with major Hollywood studios and celebrities, including Katy Perry.

Such grave allegations raised by former employees could potentially lead to more witnesses in the lawsuit, which might not be favorable for Theta. Although THETA is not experiencing significant price movement at the moment, these allegations could become a pressure factor on the charts as the case progresses.

Theta Coin Developments

The team announced the EdgeCloud upgrade for Theta Network today. This major infrastructure upgrade, coinciding with the day of the lawsuit filing, offers NVIDIA H200 GPUs at the same price as H100s. W1lliamLogan stated:

“The EdgeCloud upgrade from Theta Network provides 141 GB VRAM, delivering 2.5 times faster AI training and inference speeds. This advancement enhances capacity and efficiency for developers and businesses leveraging the platform. With support from enterprise validators like Sony Europe, Theta continues to advance decentralized video streaming and edge computing infrastructure.”

Hence, December 16 brings both good and bad news for Theta. Observing the graph, the price remained nearly stable throughout the day above the 0.317-dollar support.

In March and December of 2024, Theta Coin hit lower peaks and failed to maintain a price above 1.03 dollars throughout 2025. The altcoin, unable to surpass last year’s peaks over 3 dollars, dipped to 0.2 dollars in the October 10 decline. It last visited these levels back in September 2020.

If the lawsuit begins to negatively impact the chart or if market-wide sell-offs accelerate, Theta might test its next support level from 2020, at 0.118 dollars.