Key Takeaways

  • The U.S. SEC has charged five individuals with connections to the crypto Ponzi scheme BitConnect.
  • BitConnect was mainly active in 2017. It raised more than $2 billion during the year that it was operational.
  • Regulators initially took action against BitConnect in 2018.

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The U.S. Securities and Exchange Commission has charged five individuals in connection with the Ponzi scheme BitConnect.

SEC Charges BitConnect Promoters

The SEC says that from January 2017 to January 2018, BitConnect sold its cryptocurrency securities through four main promoters: Trevon Brown (aka Trevon James), Craig Grant, Ryan Maasen, and Michael Noble (aka Michael Crypto).

The SEC says that these individuals advertised BitConnect by publishing testimonial videos to YouTube, and that they received commissions for successfully attracting investors.

It adds that another individual, Joshua Jeppesen, acted as a liason between BitConnect and its promoters.

The SEC charges the promoters with violating the registration provisions of federal security law and charges Jepsen with aiding and abetting BitConnect’s unregistered securities offering.

The regulator has filed its complaint in the United States District Court for the Southern District of New York.

What Was BitConnect?

BitConnect raised more than $2 billion from investors in 2017, and it briefly entered the list of the top twenty cryptocurrencies.

However, the scheme was short lived, and investors quickly suspected BitConnect was a Ponzi scheme due to to the unlikely returns that it promised. Regulators in Texas, North Carolina, and Kentucky issued cease and desist orders and restraining orders.

Though BitConnect was a short-lived operation, it remains one of the most infamous crypto Ponzi schemes in crypto history.

Another related scheme, BitConnect 2.0, emerged in 2019, but ultimately amounted to nothing and quickly disappeared.

Disclaimer: At the time of writing this author held less than $75 of Bitcoin, Ethereum, and altcoins.

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