U.S. authorities have arrested 11 people in an international cryptocurrency ponzi and pyramid scheme that they suspected tricked millions of people around the world into investing more than $300 million in the Forsage platform, the Securities and Exchange Commission. indicted. announced Monday marks the latest crypto crackdown as the scrutiny on the industry intensifies.
The SEC alleges that Forsage operated as a traditional Ponzi scheme, pouring money into early investors and paying out those who persuaded other investors to join.
Forsage solicited users to deposit crypto assets into its platform to fund “smart contracts” that were automatically executed to earn profits, but the SEC said these assets would instead be It claims to have been used to benefit individuals higher up the pyramid.
Authorities have indicted four foreign-based founders of Forsage, who were last known to have lived in Georgia, Indonesia and Russia, and seven Americans who promoted Forsage.
According to Forsage’s website, the company generated more than $1.3 billion in lifetime revenue, had 2.1 million users, and accepted Binance, Ethereum, and Tron crypto tokens.
The SEC has expanded its crypto regulation in recent months, expanding the positions of its newly named crypto assets and cyber unit from 30 to 50 in May. Last month, the SEC arrested Three people, including the former product manager of cryptocurrency exchange Coinbase, participated in the first cryptocurrency insider trading case.the cryptocurrency market pretty cold Bitcoin’s price has surged by more than 50% this year, prompting several companies to lay off large portions of their workforce.
Carolyn Welshhans, deputy chief of the SEC’s Crypto Assets and Cyber Unit, called Forsage a “massively launched and aggressively marketed fraudulent pyramid scheme to investors” in a release.