Fireblocks Being Sued for Allegedly Losing Over $70M of Ether: Report

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Crypto custody provider Fireblocks is being sued by a company claiming it lost access to more than $70 million worth of ether, according to a report by Calcalist. Fireblocks said it is investigating the issue.

  • Crypto staking platform StakeHound filed a lawsuit against Fireblocks at the Tel Aviv District Court on the grounds of alleged negligence, Calcalist reported Tuesday.

  • A Fireblocks employee allegedly did not protect or back up the private keys to a digital wallet, which were then deleted, preventing StakeHound from accessing its assets.

  • “This is a human error committed by an employee of the defendants, who worked in an unsuitable work environment,” the filing said, according to Calcalist.

  • “The defendant irrevocably lost access to the plaintiff’s digital assets, which were deposited in an e-wallet provided by the defendant, causing the loss of 38,178 of the plaintiff’s ETH coins,” equivalent to nearly $72 million at the time of writing.

  • In response, Fireblocks said, “We are actively investigating the situation and assisting all parties involved to resolve the issue,” in a statement on its website.

  • “All Fireblocks’ customers’ funds are safe, and customer keys are backed up and recoverable,” the statement said. In this case “the keys were generated by the clients and stored outside the Fireblocks platform.”

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