Market Maker (MM) HMSTR Token Arrested by FBI in Portugal

Bittime - In a significant development, Gotbit CEO, Alexey Andryunin, has been arrested in Portugal at the request of the FBI and is now awaiting extradition to the United States. This arrest reveals Gotbit's involvement in a fraud scheme related to HMSTR tokens, which has alarmed many investors.

HMSTR Token Price Drop

After Andryunin's arrest, the $HMSTR token price saw a sharp decline of 12% in the last 24 hours. This situation adds to concerns among investors who have invested in the token, showing the direct impact of the ongoing legal events.

Indications of Cryptocurrency Fraud

The US Department of Justice has identified 16 companies and more than a dozen individuals in a cryptocurrency fraud scheme involving Gotbit, ZM Quant, and CLS Global. This investigation resulted in four arrests, six plea deals, as well as the seizure of more than 30 million dollars in cryptocurrency.

FBI Investigative Project

As part of the investigative efforts, the FBI launched their own token called NexFundAI, which is built on the Ethereum blockchain to investigate fraudulent practices. In this covert project, the FBI approached various market makers (MM) to offer their services, leading to exposure of manipulative practices.

Manipulative Practices Discovered

In private conversations with an FBI undercover team, employees of market maker companies revealed the algorithms they used to increase trading volume, create multiple wallets to distribute tokens, and manipulate markets. The FBI calls these practices “wash trading,” “artificial transaction activity,” and “market manipulation.”

Threat of Serious Punishment

If convicted, individuals involved in this scheme could face prison sentences of up to 25 years. This case highlights the risks that exist in the world of cryptocurrency as well as the serious consequences that can result from engaging in fraudulent activities.

Conclusion: Be Aware of the Risks in the Crypto Space

This case is an important reminder for investors and players in the cryptocurrency industry to remain vigilant and informed. Engagement in fraudulent practices can result in severe legal consequences, and it is important for individuals to conduct thorough research before investing.

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