ElizaOS Token Declared Dead as Foundation Shuts Down Amid Lawsuit Settlement
Shaw Walters, founder of Eliza Labs, announced that the ELIZAOS token is dead and the Eliza Foundation will shut down due to a class-action settlement. The foundation transferred its remaining cash and crypto reserves to settle the lawsuit brought by Burwick Law on behalf of token holders.
The lawsuit claims false advertising, deceptive business practices, negligent misrepresentation, and unjust enrichment against Walters, Eliza Labs Inc., Sebastian Quinn-Watson, the AI16Z DAO, and others. The complaint alleges that the project marketed itself as an autonomous, AI-run venture fund modeled on Andreessen Horowitz when insiders actually controlled it.
The token's market capitalization has fallen to around $2.3 million from its peak of roughly $2.5 billion in January 2025. Walters denied accusations of profiting at holders' expense and claimed that he never sold his personal AI16Z holdings.