Done With Drama, Tezos Board Member Resigns

One of the three board members of the Swiss foundation that conducted the online fundraiser for the embattled Tezos cryptocurrency tech project has resigned.

According to Reuters, the departure of Guido Schmitz-Krummacher, a Swiss legal and management expert, will probably add more turmoil to the project, which raised $232 million in cryptocurrencies in July.

The project has been locked in a battle over control between its founders, Arthur and Kathleen Breitman, and the president of the Zug-based Tezos Foundation, Johann Gevers. The Breitmans own the Tezos source code through a Delaware-based company they control, but the Tezos Foundation controls all of the fundraiser’s proceeds.

Schmitz-Krummacher resigned because he was frustrated by the infighting. Under the foundation’s bylaws, Gevers gets to nominate Schmitz-Krummacher’s replacement. If the third board member votes against the candidate, Gevers can cast an overriding vote.

The standoff has delayed the Tezos project’s launch, which has resulted in a class-action lawsuit, filed on Oct. 25 in California Superior Court in San Francisco. The suit argues that Tezos violated U.S. securities laws and defrauded investors in its initial coin offering (ICO) because it hasn’t yet issued any digital coins.

Last month, however, Bitcoin Suisse, the Swiss cryptocurrency broker that helped the blockchain startup raise $232 million, said it is not aware that any of the funds invested have been mismanaged, lost or put at any risk by the founders of Tezos.

In the meantime, on Tuesday (Dec. 12), a group of Tezos supporters launched an online petition seeking Gevers’ resignation or dismissal on Tuesday. They called for the board to unanimously elect a replacement for Schmitz-Krummacher, who is “completely independent” with no ties to current or former board members. More than 1,200 people have signed the petition.

According to Swiss filings, the foundation’s regular auditor resigned in late November. An independent auditor is now examining allegations made by the Breitmans of wrongdoing by Gevers, which he denies. That auditor’s report has not been completed.