Wednesday, September 23, 2015

Bitcoin Ponzi Scheme

(New York)
A Texas man pleaded guilty to defrauding people out of $4.5 million in what the U.S. said was a first-of-its-kind Ponzi scheme involving investments in the virtual currency bitcoin.

Trendon Shavers, 33, founder of Bitcoin Savings and Trust, raised at least 764,000 bitcoins by promising investors a return of as much as 3,641 percent, prosecutors said. Instead, he used bitcoins from new investors to cover payments owed to earlier clients, while also paying for his own Las Vegas gambling and spa treatments, according to the U.S.

At the peak of his scheme in 2011 and 2012, Shavers held about 7 percent of all bitcoins in circulation, prosecutors said.

“I know what I did was wrong and am very sorry,” Shavers said at a court hearing before U.S. Magistrate Judge Sarah Netburn in Manhattan Monday.
Shavers is scheduled to be sentenced in February.


Wireless.Phil said...

Bit Coin still in the news.

BitGo Posts $1 Billion in Bitcoin Transactions in Single Quarter

CoinTelegraph-8 hours ago

Bitcoin security platform BitGo has released new corporate information showing transactions of over US$1 billion in bitcoin for the most recent 

KeepKey Launches New Bitcoin Hardware Wallet

CoinDesk-12 hours ago

KeepKey's new USB bitcoin wallet has gone on sale, enabling consumers to store their bitcoins offline. The wallet, which is on sale for $239, .

Wireless.Phil said...

Then there is this:

Who is Charlie Shrem?

Former BitInstant CEO and Bitcoin Foundation board member Charlie Shrem is now conducting an ongoing ask-me-anything (AMA) session from Lewisburg Federal Prison Camp in Pennsylvania.

locomotivebreath1901 said...

"First-of-its-kind Ponzi scheme?"

Hardly. The U.S. federal reserve has been scamming the world since the 1970's with this type of shell game.


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