FROM CROSSCHAIN MARKETPLACE TO THE COURTROOM: Burwick Law Files A Class Action Lawsuit Against Magic Eden, Alleging The Platform Misled $ME Token Holders About Its Promised Utility!

Magic Eden is heading to court after a class action lawsuit was filed against the platform, alleging it misled $ME token holders by failing to deliver on the coin’s utility.

The timeline was tort on Tuesday as Burwick Law took to X and shared the 16-page complaint it filed earlier this month in the U.S. District Court for the Eastern District of New York against Magic Eden Co-Founders Jack Lu, Zhuoxun Yin, Sidney Zhang, and Zhuojie Zhou, along with Euclid Labs Inc. and the ME Foundation.

 

“This case is about a company and its founders who promoted a digital token called$ME as a product with real use cases inside a growing Magic Eden ecosystem,” the law firm wrote. “Consumers were not merely told that $ME was a token that might rise or fall in price. They were told why it would have value: it would be used across multiple blockchain networks, provide voting power over platform decisions, reward users who traded or locked their tokens, later be supported by revenue-allocation and buyback programs, and serve as the economic backbone of Magic Eden's expanding digital-asset platform.”

 

 

As the Gazette previously reported, the Magic Eden Foundation launched $ME in December 2024, saying the token would power the platform's crosschain marketplace through DAO governance, staking, rewards, and more .

“Magic Eden stands for all chains, all assets, all communities. Fueled by $ME, for the first time users across major ecosystems like SOL, BTC and EVM will come together as one community,” Magic Eden CEO Jack Lu tweeted at the time“New users coming on chain value convenience, simplicity and trust. They want to go to a place where they can see everything, trade everything. Magic Eden will work towards that vision. Our community will be a place where anyone can explore different chains and different communities. No tribalists tearing each other down here, let’s win together.”

 

 

However, the dream of Magic Eden’s crosschain marketplace and ecosystem was short lived.

in March, the platform shut down its Bitcoin, Ethereum, and Layer 2 marketplaces as the company pivoted away from multichain NFT trading and toward Solana and its new gambling venture, Dicey.

 

At the time, Magic Eden said it could no longer justify the costs of crosschain NFT trading, and Lu argued that this move would benefit $ME holders.

“By winding down these products, we're refocusing on our Solana roots & retaining our most profitable products, betting on deep on crypto entertainment, and positioning our products for long term growth incl. the role of $ME token and our community plays within it,” he tweeted on February 27th . “The future of ME is simpler, faster, and fueled by our original home on Solana and the success of Dicey.”

 

 

In its complaint, Burwick Law alleges that these changes to what $ME was and what it would be used for harmed token holders, who did not own equity in Magic Eden, because they solely relied on the utility the token was supposed to provide.

“The alleged deception is that the use cases did not materialize as represented. The multi-chain marketplace strategy was abandoned in material part. Governance was delayed for approximately nine months. Broad revenue-sharing and staking-reward mechanisms were not implemented until 2026, and the November 2025 buyback program was later changed and discontinued in material part. Trading rewards were not delivered in the represented form. The wallet users were required to adopt for the airdrop was later shut down. The platform pivoted away from the represented multi-chain digital-asset ecosystem and toward Dicey, a crypto casino and sportsbook. Consumers were harmed because they paid for, held, staked, or locked a digital assetmwhose value depended on represented use cases that were delayed, diminished, abandoned, contradicted, or never delivered as represented.”

 

At the time of this article’s publication, Magic Eden’s $ME token’s market cap is. $56.4 million USD, which is down nearly 99% from its all time high of $1.6 Billion USD.

 

Tonight, Magic Eden and Jack Lu have yet to respond to this lawsuit.

 

The Gazette is working to find out more about this case and  is working to bring you interviews with $ME holders, lawyers, and more. Stay tuned for updates!