The Securities and Change Fee (SEC) continues its enforcement actions in opposition to the cryptocurrency business, submitting Emergency motion in opposition to Miami-based cryptocurrency hedge fund BKCoin and its principal Kevin Kang.
A hedge fund launched in 2018 by co-founders Carlos Betancourt and Kevin Kang has raised $100 million from greater than 55 traders to put money into crypto property, based on the SEC grievance. and for private use. Eric Bustillo, Director of the SEC’s Miami Regional Workplace, mentioned:
As we allege, traders deposited cash with defendants to commerce crypto property. As an alternative, the defendants embezzled their very own cash, ready false paperwork, and even engaged in Ponzi-like conduct.
Has BKCoin carried out the largest rip-off within the business?
An SEC submitting in opposition to a Miami-based crypto hedge fund alleges that BKCoin and its principal Kevin Kang “violated” anti-fraud provisions of federal securities legal guidelines. and Kang have assured traders that their funds will probably be used to commerce crypto property and that BKCoin will generate extra income by means of separate managed accounts and 5 non-public funds.
Moreover, Kang and BKCoin allegedly used over $3.6 million to make “Ponzi-like” funds to fund traders. On this regard, the SEC alleges that Kang “diverted” greater than $371,000 of investor funds to pay for holidays, tickets to sporting occasions, and an house in New York Metropolis.
The SEC grievance alleges that Kevin Kang has managed a 3rd social gathering who falsified investor paperwork and “inflated” checking account balances for among the funds raised for the reason that launch of the cryptocurrency hedge fund. handed over to the individual
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The grievance additionally accuses BKCoin of misrepresenting to traders that the cryptocurrency hedge fund or any of the 4 funds obtained audit reviews from “prime 4” auditors. Between 2018 and 2022.
In line with the submitting, the SEC’s enforcement motion requires a “everlasting injunction” in opposition to BKCoin and Kevin Kang, withdrawal, pre-judgment income, and civil penalties in opposition to each events. Eric Bustillo concluded:
This motion underscores our continued dedication to defending traders and rooting out fraud in all securities sectors, together with the crypto area.
In line with Oct. 28, BKCoin co-founder Kevin Kang was accused of misappropriating $12 million in property from three multi-strategy funds, and on Oct. 8, BKCoin’s core authorized entity, BKCoin Administration LLC. dismissed. submitting By BKCoin Company of Miami-Dade County, Florida.
International cryptocurrency market capitalization is at present at $985.9 billion, nonetheless under the $1 trillion misplaced since final week’s Silvergate feud. BTC at present has a market capitalization of $432 billion, accounting for 40.36% of the sector.
In the meantime, stablecoins have a market cap of $136 billion, accounting for 12.7% of the full cryptocurrency market cap.
Featured picture on Unsplash, chart on TradingView.com