Two former employees of US-based crypto company Theta Labs have filed lawsuits in California accusing the firm and its chief executive, Mitchell Liu, of fraud and market manipulation, according to Bloomberg Law.
Theta Labs Sued by Former Employees Over Alleged Market Manipulation
17 December 2025 - 11:42 CET
By Giles Broom
The complaints, filed this week in the Superior Court of California in Los Angeles County, allege that Theta Labs engaged in a series of schemes over several years to inflate the value of its crypto tokens and non-fungible tokens through misleading promotions and partnerships.
CEO target
The former employees claim the alleged conduct personally benefited Liu, who co-founded the company and remains its chief executive. Theta Labs and Liu did not immediately comment on the allegations, Bloomberg Law reported.
According to the cited filings, the plaintiffs allege that Theta Labs pursued high-profile partnerships with entertainment companies and celebrities to boost market interest in its products, while internally engaging in practices they describe as manipulative. The lawsuits seek damages and other relief, and the claims have not yet been tested in court.
Theta Network
Theta Labs develops Theta Network, a blockchain platform focused on video streaming, cloud computing, and digital media infrastructure. The company operates a dual-token system, consisting of one token used for governance and staking, and another used to pay for transactions and services on the network, known as THETA and TFUEL respectively. Founded in 2017, Theta has previously announced partnerships with technology and media companies and positioned itself as an infrastructure provider for decentralized content delivery.
Whistleblowers agitate
The cases add to a growing list of legal challenges facing crypto companies as regulators and courts globally increase scrutiny of token issuance, marketing practices and disclosures. In the US, employee whistleblower lawsuits have increasingly become a source of information for regulators and investors in the digital-asset sector, though the claims are often vigorously disputed in court.
