A Dubai firm, Alababacoin Foundation et al, has been sued by China’s largest e-commerce company, Alababa Group Holding Ltd. Using the Alibaba trademarked name in conjunction with a cryptocurrency “Alibabacoin,” the founders of the Alibabacoin set out to raise over $3.5M through their ICO, banking (quite literally) on confusion created using the reputation the retail giant has established, and the potential financial gains thereof.
At closing on the day of its IPO in September 2014, Alibaba had a $231B market value, U.S. Now one of the largest and most valuable companies in the world, Alibaba reached a market cap of $527B U.S. this past January, making them the second to the Chinese investment holding conglomerate, Tencent.
After Alibaba’s continual comments against offering a cryptocurrency, the filed complaint was that the founders of Alibabacoin have taken no steps toward correcting the confusion they’ve created with the retailer, filing the lawsuit against Alibabacoin due to damages from their unlawful activity.
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Alibaba is no stranger to court proceedings, as the need periodically arises to defend their brand against alleged sales of counterfeit products on their site. However, immediately after stating there will be no “Alibaba coin,” both alibabacoinfoundation and alibabacoinwallet domains were registered by the defendant. Coincidence? Likely not.
According to Alibabacoin Foundation’s Whitepaper, the goal of their alleged cryptocurrency is facial recognition for payment.
“The new AlibabaCoin’s blockchain technology will use artificial-intelligence techniques effective for image recognition most reliably to identify a person most accurately as possible, and use this technique effectively for the structure of payment of electronic wallets and financial transactions.”
The group lists plans for a shopping platform for international retail, especially in countries participating in crypto exchange. The paper also asserts their blockchain technology “offers a secure and extremely convenient method of payment” while shopping on any variety of platforms, including American e-tailers Amazon and eBay.
Bitcoin and Ethereum are specifically mentioned for exchange with the Alibabacoin.
The temporary restraining order against Alibabacoin in case No. 18-02897 of the U.S. District Court, Southern District of New York, is awaiting an appropriate response regarding their alleged guilt on April 11th.
Stopped at round 2 of their crowdsale, each coin was being sold for 0.00027273 BTC, roughly two U.S. dollars, the lawsuit serves to stop further violations against Alibaba, and seeks damages for the alleged New York and federal law violations.
The docket for the case filed April 2, 2018, outlines the legal steps taken in this trademark lawsuit.
Featured image from Shutterstock.