Helbiz had ICO in 2018.
Helbiz coin holders lost their money.
Now Helbiz listed on NASDAQ.
Helbiz coin investors filed a class-action case against Helbiz on June 19, 2020.

The Helbiz coin is a security - court desicion: on January 22, 2021

Helbiz may face a Federal Securities Fraud case
22.01.21

Court decision: the Helbiz Coin is a security

After 3 months of review, the judge provides the order. At first, "Helbiz Coin (the "token"), the cryptocurrency at the center of this case, is a security."

Helbiz Coin (the "token"), the cryptocurrency at the center of this case, is a security. The Securities Act of 1933, 15 U.S.C. § 77b(a) (1), and the Securities and Exchange Act of 1934, 15 U.S.C. § 78c(a) (10), both include "investment contract" in their definitions of the term "security." The United States Supreme Court has defined "investment contract":

In other words, an investment contract for purposes of the Securities Act means a contract, transaction or scheme whereby a person invests his money in a common enterprise and is led to expect profits solely from the efforts of the promoter or a third party, it being immaterial whether the shares in the enterprise are evidenced by formal certificates or by nominal interests in the physical assets employed in the enterprise.

S.E.C. v. W.J. Howey Co., 328 U.S. 293, 298-99 (1946). That definition "embodies a flexible rather than a static principle, one that is capable of adaptation to meet the countless and variable schemes devised by those who seek the use of the money of others on the promise of profits." Id. at 299. Helbiz Coin satisfies the Howey definition. Defendants treated the token as an investment from its inception. The Helbiz Coin Whitepaper's discussion of the initial coin offering ("ICO") states

In order to further develop the platform, Helbiz will conduct a token generation event that will offer 520.000.000 HBZ tokens of the 1 billion total supply. The funds raised will be used for development of the Helbiz platform, business development; onboarding new car owners, rentals, dealerships, collaborate with insurance and PR & Marketing companies to raise project awareness, token usability while at the same time building a strong local community.

Helbiz Mobility System Whitepaper, Ex. J to Plaintiffs' Motion for Preliminary Injunction, at 17. Helbiz and its CEO Salvatore Palella described how the Helbiz transportation platform and the token were a common enterprise:

"We are now only focused on launching and scaling operations, creating value for early investors and the #HBZ coin." Id. ~~ 87, 124.

"Helbiz is focused on the long term success of HBZ and therefore the team [is buying] $lm (USO) of HBZ on the open market, paired with additional large buy walls on the main exchanges, to strengthen the company's position both internally and to new investors #Helbiz." Id. ~ 120(1) (alteration in original).

They also worked to get the token listed on various cryptocurrency exchanges:

A. The tweet from PALELLA on May 31, 2018: "May has come to an end. @Helbizofficial is more attainable and launched on 11 exchanges, finished our updated UI for our apps, acquired a new office in NYC and will now focus on the press aspect globally. #hbz #Helbiz."

B. The tweet from PALELLA: "Eventful first 60 hours of the week, with our third excha~ge of the week [email protected] will list on @jitbtc!" This included a response from Defendant PELLEG~INO: "Impressive"

C. Postings to PALELLA's personal facebook page: "Happy to be in #London for the launch of @Helbizofficial $HBZ (4/26) in the exchange";

D. "Helbiz is now listed on its first exchange!";

E. "We are happy to partner wi~h Anthony Diorio and his team listing Helbiz on Jaxx.io";

F. "Proud of my Helbiz team. I love the Jaxx.io integration. Exchanges (sic) coming soon!" and a link to an article "Helbiz HBZ token integrated into Jaxx Multicurrency Digital Wallet";

G. "Helbiz is now live and listed on bonus exchange Mercatox with a Top 10 exchange listing coming soon!";

H. "It is now 1 month since Helbiz got listed, and today 30 days later Helbiz is traded on 11 exchanges and 26 markets globally. With product launch getting closer I am excited for the next couple of months! #HBZ #Helbiz #HelbizP2P #HelbizPay";

I. Also, @Helbizofficial tweeted in November of 2018: "We are working on listing one [of] Jaxx's large partner exchanges."

See id. ~~ 120. And plaintiffs constantly call themselves investors in the complaint (33 times) and describe the defendants' program as a "pump and dump" investment scheme:

This action is brought to obtain justice for approximately 20,000 small investors who were swindled in a crypto currency scam called HelbizCoin perpetrated by Defendants PALELLA and HELBIZ INC. ("HELBIZ"). The scam preyed mainly on small, unsophisticated investors, with the average investment being approximately $2,000. But by leveraging the exponential messaging capacity of social media worldwide, and by creating purposeful misimpressions about the size of the company and the popularity of the investment, Defendants were able to trick thousands of people and extract over $40 million dollars by an initial coin offering ("ICO") and by later dumping the coins on the secondary market.

Complaint~ 2. The token was an expected source of profit on resale, and its purchase was a classic "laying out of money in a way intended to secure income or profit from its employment." Howey, 328 U.S. at 298.

While Helbiz Coin was initially sold as both a method of paying transportation fare and an investment product, when Helbiz repeatedly delayed adopting the token as its exclusive payment method, it became increasingly clear that the token was in fact an investment. After promoting Helbiz Coin as the "native token for Helbiz transactions," the company stalled the integration of the token into its platform:

55. HELBIZ also changed its story about the role that the HelbizCoin would play. First, it announced plans to expand HelbizCoin's use case far beyond transportation to restaurants and online shopping and in point of sale terminals with retailers world wide. This was bunk, intended to soften the blow of the rest of the announcement.:

56. Simultaneously with announcing these new ambitions for the coin, HELBIZ said that it had redesigned the platform so that it did not use HelbizCoin. :

57. HELBIZ tried to justify the announcement with doubletalk to the effect that it was supposedly acting in the best interest of the coin holders by delaying its promise to make HelbizCoin the platform's currency because taking fiat currency instead of HelbizCoin would drive adoption of the platform and thereby (allegedly) increase the value of HelbizCoin when HELBIZ switched the platform over to HelbizCoin at a future date. :

58. The company announced that the switch from fiat to HelbizCoin would now happen in a fourth phase of the development, Helbiz V4.0: "In the 4th phase Helbiz will utilize its user base, previous growth and position within local communities to phase out direct fiat payments in the Helbiz app moving towards a crypto only solution. All purchases, even with credit card, will simply purchase HBZ of the open market via the exchange API to fill the in-app wallet which will only hold HBZ making it the only accepted currency." (Compl. ~s)

When Helbiz eventually began accepting the token, "it was in parallel with fiat prices, not exclusive as promised, and did not get much use as a result." Id. ~ 66. Helbiz then abandoned the notion that the Helbiz Coin would be its exclusive payment method, while the token's value plummeted.

Speaking of Helbiz's planned destruction of the token, Helbiz engineer Carlos Beltran tweeted "I'm a lead engineer at HELBIZ and can say a thing or 2 about the matter - I integrated HBZ as a partner payment solution. We didn't see enough usage of HBZ @hbzcoin as trip payments, and therefore discontinued the partnership." Id. ~ 115.

The economic reality is that buyers of Helbiz Coins in the ICO expected they would profit from the tokens' value rising along with demand as Helbiz used revenue from the ICO to grow its transportation platform and promote token use. The token's admittedly trivial use as a transportation fare was dwarfed by its promotion, purchase and use as an investment product, just as the buyers of tracts of land for citrus cultivation in Howey had "no desire to occupy the land or to develop it themselves; they are attracted solely by the prospects of a return on their investment." 328 U.S. at 300.

The Helbiz Coin is an investment in a common enterprise, from which the investor was led to expect profits primarily from defendants' entrepreneurial efforts. Its use as a fare for transportation was insignificant. "If that test be satisfied, it is immaterial whether the enterprise is speculative or non-speculative or whether there is a sale of property with or without intrinsic value." Id. at 301.

From any point of view, the Helbiz Coin is a security.


Look at legal order here

Second, the judge ruling "The HelbizCoin Initial Coin Offer was of a security which was not listed on a United States exchange or purchased in the United states. As stated in Morrison, p. 11-12 supra: This case involves no securities listed on a domestic exchange, and all aspects of the purchases complained of by those petitioners who still have live claims occurred outside the United States. Petitioners have therefore failed to state a claim on which relief can be granted. (561 U.S. at 273) The complaints are dismissed without prejudice to renewal in other jurisdictions.

But such as it's 20 666 active wallets with Helbiz coin on Etherscan, and there were only 10 plaintiffs in case, it's may be appealed.

Plaintiffs won the appeal:

On October 4, 2021, Plaintiffs won an appeal case against Helbiz. The appeal court canceled the judge's decision about jurisdictions. Appeal order states: "The district court erred in relying on these documents and viewing them most favorably to Defendants. We have considered Defendants’ remaining arguments and find them to be without merit. Accordingly, we VACATE the judgment of the district court and REMAND for further proceedings consistent with this order.". So, soon Plaintiffs will amend their complaint, and the process will go on in New York Southern District Court. Moreover, as we understand, Plaintiffs are going to make a separate federal securities claim under Section 10(b). Look the order here.


So, make your conclusions!

What does it mean and how it relates to Helbiz?

Helbiz deceived all Helbiz coin holders, had cut off all conection with ICO. Helbiz build the project for money from tokensale and going to IPO. The Helbiz coin holders lost their money and suited Helbiz.

Now, we get court-ordered Helbiz coin is a security:
1. So, Helbiz coin holders are investors to Helbiz.
2. If you invest in Helbiz IPO, have you got documents about the capital that Helbiz got from ICO and token sale?
3. Has Helbiz filed related documents to SEC?
4. Helbiz may get a lot of individual suits related a securities and SEC

So, make your conclusions!