What this lawsuit is about

Two firms affiliated with market maker DWF Labs have filed a $141 million claim against crypto custodian BitGo in London’s High Court, according to the Financial Times. The claimants are DWF Maas, based in the British Virgin Islands, and Falcon Digital, based in Panama. They allege that BitGo sold discounted tokens before agreed lock-up periods ended. Neither BitGo nor DWF immediately responded to requests for comment from Unchained.

How the token deals were meant to work

The claim says BitGo received Falcon Finance (FF) tokens at a reduced price and agreed to hold them for three months, with more vesting restrictions after that. DWF says a matching structure covered ESPORTS tokens, which are used in gaming.

These arrangements are described as over-the-counter sales. That means projects bring in funds privately instead of selling tokens into the open market. Buyers usually pay less for the tokens because they accept a holding obligation.

What DWF says went wrong

DWF reportedly said the discount was “conditional on the tokens remaining locked.” It said the tokens “were moved to exchanges roughly two months before the first unlock.”

According to DWF, the issue was raised with BitGo in April and May. Court action followed when BitGo offered no undertaking. DWF said, “We remain hopeful of, and open to, resolution.”

The filing also says the holding periods were intended to let DWF build products that would make the tokens easier to trade. It argues that the alleged early sell-offs left the FF and ESPORTS tokens it continues to hold worth less. The filing says there was no contractual or legal excuse for BitGo’s conduct.

Why lock-ups matter in crypto

Lock-up and vesting terms are designed to slow the release of tokens into the market. When tokens are sold too early, supply can reach exchanges faster than the project’s trading activity and product rollout can absorb it.

For a market maker or token holder, that can affect inventory value and liquidity planning. For users, it highlights that token supply is not only about how many tokens exist. It also depends on when those tokens are allowed to circulate and who controls them during the holding period.

What the reported price data shows

The Financial Times reported, based on CoinMarketCap figures, that Falcon Finance (FF) traded at $0.08 in early March and about $0.07 in late April. It also reported that by early June, when DWF alleges BitGo sold, ESPORTS was at $0.07, down from about $0.28 in mid-March.

These numbers describe market prices. They do not by themselves prove what happened inside the custody arrangement.

What this means for users

The case is still a claim, not a final judgment. It matters because BitGo is a custodian, a firm that holds digital assets for clients. If a custodian’s handling of locked tokens is disputed, users may pay closer attention to how tokens are held, released, and traded.

The lawsuit also shows how private token sales can create obligations beyond simple buying and selling. Discounts may be tied to time-based restrictions, and those restrictions can become central to legal disputes.