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May 17, 2014

As the most prominent trade group pushing adoption of the electronic currency Bitcoin begins its annual conference yesterday, it is being roiled by controversy.

At least 10 members of the nonprofit Bitcoin Foundation have resigned over last week's election of onetime Disney child star and current Bitcoin entrepreneur and financier Brock Pierce as a new director, officials at the group said.

Some of the members cited Pierce's troubled past. That includes allegations in lawsuits from three employees of Pierce's first company, bankrupt web video business Digital Entertainment Network, that he provided drugs and pressured them for sex when they were minors.

Pierce has denied the accusations, which first surfaced in 2000.

"The allegations against me are not true, and I have never had intimate or sexual contact with any of the people who made those allegations," Pierce told Reuters via email.

Court records show 33-year-old Pierce, who played the title role in Disney's "First Kid," paid more than US$21,000 (RM67,903) to settle one employee suit, and he said others dropped their claims without money changing hands.

While Bitcoin Foundation officials played down the defections, several members who resigned from the Foundation assailed its governance track record.

"The track record of prominent Bitcoin Foundation members has been abysmal," said Patrick Alexander, a resigning Foundation member in a post on its discussion pages. "I no longer want to be associated with these people."

Attempts to reach him for additional comment were unsuccessful.

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