Dragonfly exec says the firm declined investment in Eclipse amid sexual harassment allegations against its CEO

Dragonfly Capital has passed on investing in Eclipse as sexual harassment allegations against its CEO, Neel Somani, have come to light.

In a May 10 X post, Haseeb Qureshi, managing partner of crypto VC firm Dragonfly Capital, said that his firm declined to invest in Eclipse while completing due diligence on the L2 solution.

During the process, Dragonfly discovered a history of sexual harassment surrounding Eclipse’s founder, Neel Somani.

“If we heard this doing only minimal diligence, there’s no way the actual investors didn’t also hear the same,” Qureshi added.

Eclispse is Ethereum’s fastest L2 solution, powered by the Solana Virtual Machine and geared at privacy, security, and decentralization.

The managing director further stated that based on what they had learned, this was a longstanding pattern of behavior from Somani, who is accused of misconduct ranging from inappropriate social media behavior to grave accusations of sexual assault.

Qureshi concluded that despite his past, Somani got investment and successfully sold millions in secondary for a pre-launch token, which was “embarrassing.”

Meanwhile, on the same day, the Eclipse head also took to X to maintain his innocence, claiming that he had never sexually assaulted a woman.

Somani said that he would leave his role as Eclipse’s “public face” since it would be unfair to the team and the L2 solution “to have this situation weighing on their reputations,” adding:

“I’ll be temporarily reducing my role as a public face for Eclipse. The senior leaders at Eclipse are well equipped to take on these responsibilities and this will allow these conversations to unfold and the truth to emerge about these allegations.”

In a separate statement, Eclipse noted that the firm “remains committed to maintaining the highest personal and professional standards, including gender equality and fair treatment.” The company will also carefully monitor the matter and provide details regarding the other senior Eclipse members who are leading Eclipse.

At the time of writing, Somani has not been charged with any crimes and allegations of professional misconduct have not been tried nor proven in court.