- Sphere 3D sues partner company, Gryphon Digital
- The Gryphon Spoofing account happened twice.
- Sphere 3D did not reveal all the details of the litigation.
Crypto Mining platform Sphere 3D has filed a lawsuit against their partner company, Gryphon Digital Mining, after an alleged spoofing attack led to an irregular transfer of Bitcoin, according to documents provided for the court.
In a statement Sphere 3D released, they announced the litigation they filed against Gryphon, the custodial management service provider for their blockchain and cryptocurrency-related services, with an accusation of materially breaching the Master Services Agreement (MSA$ between both companies.
The CEO of Sphere 3D, Patricia Trompeter, also stated to their investors that Gryphon Digitals had put the company’s assets at risk and violated the duties they were contracted for willfully.
According to the information in Sphere 3D’s complaint, Gryphon’s CEO Rob Chang is accused of allegedly wiring 18 BTC in January to a fraudulent account that had posed as the chief financial officer for Sphere 3D through a spoofing attack and just a few days after that. They also sent 8 BTC to the same address.
A spoofing attack sees an attacker attempting to trick a system or a user into believing that they are another person through the use of falsifying data, with information like email headers, user credentials, and IP addresses to gain access to a system or gain entry into stealing sensitive information or to launch other hacking attacks on the system.
In a conversation with Cointelegraph, Gryphon’s CEO said that his company had been made aware of the complaints and was looking forward to defending its stance. He also deigned to comment on the pending litigation. Still, he claimed that their impending response to the protests, the documentation, and every evidence associated with it would come to light in the aftermath of the lawsuit.
Both companies have been partners since August 2021, and Gryphon has been in charge of managing Sphere 3D’s crypto mining activities and the maintenance of their fiduciary duties of Sphere’s digital assets.
Gryphon Digital Management also receives 22.5% of Sphere’s gross profit as payment for their services for the company.
The statement made by Sphere also hints that the relationship between Sphere and Gryphon was almost at the stage of considering a merger has not deteriorated, essentially the filing of litigation against Gryphon demonstrates that they would not take any threats or bullying from Gryphon, as the company has failed to act with integrity and also failed to honor the contract between both companies and the lawsuit would ensure that they are held accountable for their actions.
Cointelegraph reached out to Sphere 3D for more information but has yet to receive an immediate response from the mining company.
Conclusion
Gryphon and Sphere 3D claimed they are committed to the growth of their crypto-mining operations with a net carbon-neutral impact. A merger agreement brewing between both companies was terminated.
