Terra ecosystem collapses, Sam Bankman-Fried buys Robinhood stock, and crypto trader receives jail sentence for a ponzi scheme: Hodler’s Digest, May 8-14

Coming every Saturday, Hodler’s Digest will help you track every single important news story that happened this week. The best (and worst) quotes, adoption and regulation highlights, leading coins, predictions and much more — a week on Cointelegraph in one link. Top Stories This Week Breaking: Terra blockchain officially halted following LUNA price collapse This week, news about the Terra ecosystem dominated the headlines after algorithmic stablecoin TerraUSD (UST) lost its peg to the U.S. dollar — and continued to crash.  At its lowest point during the week, UST fell…

Read More

DOJ indicts BitConnect’s Indian founder for $2.4B crypto Ponzi scheme

The founder of the infamous crypto exchange BitConnect, Satish Kumbhani, has been charged for allegedly misleading investors globally and defrauding them of $2.4 billion in the process. According to the Department of Justice (DOJ), a San Diego-based federal grand jury specifically charged Kumbhani for orchestrating the alleged Ponzi scheme via BitConnect’s “Lending Program”: “BitConnect operated as a Ponzi scheme by paying earlier BitConnect investors with money from later investors. In total, Kumbhani and his co-conspirators obtained approximately $2.4 billion from investors.” BitConnect (BCC) price history. Source: CoinMarketCap Back in 2017…

Read More

Bitconnect promoter pleads guilty over Ponzi scheme, as platform faces new SEC charges

Former director and promoter of the notorious Bitconnect Ponzi scheme, Glenn Arcaro, has pled guilty to fraud charges related to his role in the now-defunct crypto exchange and lending platform He has been ordered to pay back $24 million to investors. In a parallel action in the long-running saga the United States Securities and Exchange Commission (SEC) has charged Bitconnect, its founder Satish Kumbhani, former director Arcaro, and Future Money Ltd. over the scheme. The defendants are accused of running a fraudulent, unregistered securities offering that netted $2 billion. The…

Read More

Minneapolis Fed President Neel Kashkari calls DOGE a ponzi

Federal Reserve Bank of Minneaopolis President Neel Kashkari took a jab at Dogecoin (DOGE) last week by referring to the meme coin as a ponzi, upping his rhetoric against cryptocurrencies.  Kashkari’s comments were in response to a LinkedIn poll by Paul Grewal, the chief legal officer and corporate secretary at Coinbase, asking his connections about the proper way to pronounce Doge. “The right pronunciation is pon-zi,” Kashkari quipped. Fifty-seven percent of respondents pronounce Doge correctly. Source: LinkedIn. Kashkari’s witty attempt gets over 200 interactions. Source: LinkedIn This isn’t the first…

Read More

S.E.C. charges 5 for illegally promoting $2 billion Bitconnect Ponzi

Three years and some unforgettable memes later, the Securities and Exchange Commission has announced that 5 individuals will face charges relating to promoting the Bitconnect Ponzi scheme.  “The SEC’s complaint alleges that these promoters offered and sold the securities without registering the securities offering with the Commission, and without being registered as broker-dealers with the Commission, as required by the federal securities laws,” the release reads. The promoters, including Trevon Brown, Craig Grant, Ryan Maasen, and Michael Noble are said to have “advertised the merits of investing in BitConnect’s lending…

Read More

Florida man escapes paying a $4.5M SEC penalty over a crypto Ponzi scheme

The founder of a multi-million crypto Ponzi scheme has escaped paying a $4.5 million penalty to the U.S. Securities and Exchange Commission. On March 23, the U.S District Court of Southern Florida initially ordered Jose Angel Aman to pay the SEC more than $4.2 million in disgorgement, and $300,000 in prejudgement interest. However, the court deemed the bill was satisfied that same day due to restitution paid in a parallel case from 2019. According to an emergency order obtained by the SEC in May 2019, Florida-based Aman operated three consecutive…

Read More

Is Bitcoin a Ponzi scheme? Pick your side in the latest Cointelegraph Crypto Duel!

Does Bitcoin meet the definition of a Ponzi scheme? This is the subject of the latest Cointelegraph Crypto Duel, where Bitcoin strategist at Kraken meets professor of computer science at the University of Campinas, Jorge Stolfi. Similar to other Bitcoin skeptics, Stolfi repeatedly defined Bitcoin as a Ponzi scheme. The core of his argument is that Bitcoin doesn’t produce any cash flows and the money with which Bitcoin investors are paid comes exclusively from new investors buying Bitcoin. “Every time you invest in Bitcoin, the money that you invest goes…

Read More

Crypto trader and accused Ponzi scheme is now fighting the SEC and jilted investors

Dissolved limited liability company Crypto Traders Management is seeing its legal troubles multiply. Per a Friday legal filing in Utah, CTM and its former manager Shawn Cutting are trying to fight off a subpoena from the Securities and Exchange Commission. The SEC is apparently demanding financial data from Cutting — specifically, all of the transaction information from his Wells Fargo accounts as well as his communications with the bank. Cutting is trying to quash the SEC’s request by pleading a right to financial privacy. Back in July, former investors in CTM…

Read More

Justice Department extradites alleged BTC mining ponzi operator from Panama

Per a Monday announcement, the U.S. Department of Justice and the Southern District of New York have extradited a leader of alleged ponzi scheme AirBit Club from Panama.  Gutemberg Dos Santos is one of six operators of AirBit Club indicted, and the last to come into the U.S. to face trial before the SDNY. Dos Santos is a dual citizen of Brazil and the U.S. Authorities initially apprehended five of the six back in August, with a sixth avoiding authorities until October.  The DoJ alleges that AirBit Club sold “memberships” that…

Read More