“AVAX Leak”: what we know about the new scandal that is shaking the crypto industry

An article has been buzzing on social networks in recent hours, carrying with it a wave of concern and excitement, against a backdrop of bright red crypto market. This article exposes, in fact, videos presented as containing very compromising elements for the project AVAXand more particularly the commercial entity Ava Labs. We take stock of this explosive file by trying to sort out the facts from the allegations, and from what could be strictly manipulation against the backdrop of an economic war between crypto giants.

What we know about the revelations about AVAX and corporate lawyer Kyle Roche

Emanating from a recently created site (last June, 3 articles online), specializing in its own terms in the “defending the honest crypto community”an article exposes a series of short videos.

These recordings were obviously captured without the consent of the person whose words are reproduced. The person concerned is named Kyle Rochehe is a business lawyer and co-founder of the firm Roche Freedman LLP. On his Linkedin profilethe cabinet looks like:

“(…) specialized in the resolution of complex and high-stakes legal disputes. In today’s dynamic and fast-paced global environment, individuals and businesses need innovative and tech-savvy legal counsel to help them resolve high-stakes commercial disputes. RF combines a unique brand of creative thinking and technical expertise with well-rounded aggressive advocacy to achieve impressive results in complex, high value, class action cases. »

Presentation of the firm Roche Freedman

Flex, lies and video

The article presents around thirty short video extracts. Each of these extracts being accompanied by a verbatim of the editor allowing him to expose what is presented as constituting revelations and put them in context.

Excerpt from the video incriminating Ava labs
Kyle Rochein full (class) action

Most of these videos appear to be captured in a standard, meeting room type business environment. Some were captured in a restaurant. Due to their quality, it seems obvious that these videos were not made with the prior consent of Kyle Roche. A hypothesis that is all the more likely since the young man, a business lawyer by trade, sets out in great detail and anecdotes the existing business relationships (or having existed) between him, and the crypto project Avalanche (AVAX).

Avalanche is the main subject of all of these videos. Due to the editing and post-production of the content, it is however impossible to know whether all of what corresponds to 2 separate interviews focused exclusively on this subject.

What we see on the videos

The one who is presented as the lawyer Kyle Roche converses freely in front of the camera with an unidentified interlocutor whose voice is modified. The young lawyer seems perfectly confident and opens up without filter to his interlocutor.

Viewing all the material makes it quite simple to deduce that Roche is thinking of addressing a neophyte interlocutor on the subject of crypto.

He takes the time to point out that the “crypto is an important topic in Turkey” or to explain who is Craig Wrightwhich he presents as the supposed inventor of Bitcoin (attracting for the anecdote an astonishing as much as suddenly He’s a brilliant man » from his hidden interlocutor).

At this stage, we can therefore reasonably assume that Kyle Roche is not aware of being recorded, and that he is convinced to exchange with a non-professional in the sector. Furthermore, Roche (who presents himself as a great connoisseur of the industry) will discuss the Bitcoin Satoshi Vision (BSV) token created by Wright, as a “Corner, Top 5”. Absolutely erroneous information, said token actually evolving around the fiftieth place of the marketcap.

Kyle Roche’s “revelations”

Without it being clear why he delivers so much sensitive information, even strategic on the company Ava Labs of which he presents himself as legal representative – and even business partner and holder of AVAX tokens for years – Kyle Roche delivers a series of elements on the legal and tactical practices of Ava Labs:

  • He and his firm would be bound by a pact with Ava Labs, a pact worth “several hundred million dollars” in AVAX tokens and “in Ava Labs shares” ;
  • This pact would aim to pursue “hidden objectives”;
  • Among these hidden objectives, use all the means available in the American judicial arsenal to harm competitors, including: Solana (Alameda), Binance…;
  • Multiply the procedures (civil, class actions, etc.) to exhaust the competitors in their defense maneuvers;
  • By doing so, attract the attention of the SEC and the CFTC (the American financial policemen), in order to dissuade them from taking an interest in Avalanche;
  • Pursue “vendetta” actions led by Emin Gun SirerCEO of Ava labs, against certain crypto personalities.

It should be noted in passing that Kyle Roche is presented in the article as “Emin Gün Sirer’s own lawyer” which he mentions under his insistent nickname “Goon” – sometimes heavily – on the affection and esteem that, according to him, unites them.

  • Kyle Roche claims to have been the very first person to receive shares of Ava Labs after the famous investor Andreessen Horowitz
  • Roche claims to own 1% of outstanding $AVAX and Ava Labs shares alone
  • This amount would correspond to about a third of what Kevin Sekniqiwho is the co-founder and current COO (Chief Operating Officer) of Ava Labs.
  • Kyle Roche and Kevin Sekniqi would share common premises in Miami “for reasons of tax optimization”

In addition to being responsible for suing Ava Labs’ competitors (“which is likely to increase the value of AVAX”), Kyle Roche believes that he has learned a new way of being a lawyer by suing “half of the players in the sector”. Ultimately, legal access to potentially valuable information.

“In the United States, when you sue an individual or company, you can demand access to their confidential accounts, business data, emails and social media communications, and more, using a special legal process called “discovery”. This helps to explore the inside of every crypto business.”

The very nature of the American contentious proceedings, and in particular the protected speech (“speech protection”) make it possible to build files in the form of class actionsin which it is possible to make potentially serious allegations about actors targeted by the procedure.

On the principle of “slander, slander, there will always be something left”, innocent projects can thus find themselves entangled in endless procedures and see their reputation tarnished. Mechanisms that the business lawyer says he has deployed on behalf of his many clients, including Ava Labs. The eternal debate/accusation on the legal status securities/commodities allowing to throw any crypto into the suspicious clutches of the SEC, seems to be part of the classic arsenal in the matter.

Finally, Kyle Roche explains that the CEO of Ava Labs has requested his services to target crypto personalities with whom he is in conflict. These procedures, qualified as “personal vendettas” reveals the suspicion of the use of corporate resources (in this case Ava Labs) in the context of personal or ego conflicts. The assertion is accompanied by an anecdote: a Turkish crypto actor with whom Emin Gun Sirer would have been in conflict, would have seen a refusal of visa on his arrival on American territory, thanks to the intervention of Kyle Roche. Less anecdotally, Roche would have been commissioned to attack Craig Wright. These attacks allegedly caused “billions of dollars in losses for investors in BSV”.

Why you should be suspicious

As noted in particular in this Twitter threadthe media behind this leak seems close to other projects in the crypto industry, and more specifically Internet Computer (ICP)a project known for various controversies (which, admittedly, is the case with most projects in the industry and which in this case does not prove or disprove much).

Be that as it may, the ICP community was prompted to retweet en masse the “revelations” of Kyle Roche, the slightly too talkative lawyer.

Moreover, the article was quickly taken up and distributed by Internet sites with conspiratorial overtones, such as the one below, specializing in “vibrational and magnetic medicine”. A site that also encourages people to go and buy… Bitcoin Satoshi Vision.

On the form of the article itself and its semantics, it is difficult not to note a deliberate dramatization of the subject. The text thus begins by explaining that this case is likely to shake the US judicial system to its foundations. Spoiler: probably not.

“We can reveal that for several years they have been operating under an extraordinary secret pact that harms the crypto industry, and is so perverse in nature that it undermines the integrity of the US legal system. »

The terminology chosen (“diabolical pact”, “perversion”…), does not leave anyone indifferent either who is accustomed to investigative work in this area, supposedly imbued with caution and balance.

A little later in the article, a passage catches our attention. Indeed, in support of his fundamental thesis, the author of the investigation cites a psychological study which would show that “Among professionals, lawyers have the second highest proportion of psychopaths, due to the opportunities this career offers them to pursue their predilections. » An “argument” to say the least astonishing which seems to be mentioned in passing only to darken a little more the content of the “revelations” exposed.

Official reactions from Avalanche

The Ava Labs team began to react, in particular by the voice of Olta Andoni, in charge of legal counsel for the project, which mentions the legal team (in which Kyle Roche does not appear). As for Emin Gun Sirerhe evoked this morning a “absurd and ridiculous conspiracy theory”.

In the event that all of this information is corroborated, everyone will judge its potentially illegal, subversive or even simply unethical content. Some will thus consider these actions intolerable, where others will see only the classic backstage, relationships and business disputes. Bloody theaters of confrontation where all blows sometimes seem permitted, without this being specific to the crypto industry or to the AVA Labs company in particular.

“AVAX Leak”: what we know about the new scandal that is shaking the crypto industry