> “Today’s indictment reiterates the FBI’s commitment to identifying and addressing bad actors defrauding investors and sullying the ability of legitimate entrepreneurs to innovate within the emergent cryptocurrency space,” said Special Agent in Charge Eric B. Smith of the FBI’s Cleveland Field Office.

I found this notable. The messaging is clear: the DoJ supports crypto within whatever the current legal framework is.

Crucial detail buried in the article:

> Kumbhani is at large

The Bitconnect Coin was among the world's most successful cryptocurrency token until its price collapsed.

So you have to be quick if you want to ride the wave of a scamcoin

Interesting that there is no mention that he has been charged of being involved in a Ponzi scheme in the headline - just "Cryptocurrency Scheme".

Why do people trust middlemen to handle their crypto in a safe manner? The whole idea behind crypto is that it's decentralized. Interacting with exchanges, investment platforms, etc is asking for trouble. Assume any exchange is another MtGox waiting to happen. Assume you no longer own your funds once you interact with any crypto platform. Fraud is rampant in the crypto scene and has been since the beginning. And for those crying 'But Coinbase!'. I don't trust them either. Coinbase must have a really hard time sleeping knowing they're the custodians / middlemen of so much wealth.

whatsaaaaa whatsaaaaaaappp!!!

one of the craziest public performances I have ever seen. and people fell for it. mind boggling.

I always used to think the founder was the guy from the famous YouTube meme. Never in my wild imagination would have though it would be a guy from pretty much rural india. World is more connected than I think I guess.

undying classic from carlos https://www.youtube.com/watch?v=XFwlWLtsw6c

So now their stuff is actually valued $2.4B and it's no longer monopoly money?

ironic how just a few stories down is an article about how approx 50% of steam payments with bitcoin (when they accepted it) were fraudulent... everyone wanting a quick buck without doing the work

Nice job. Now if only some people would see the difference between an actual ponzi scheme like this one and bitcoin and other cryptocurrencies. That would be nice.

I think this video is still one of the best comments on BitConnect: https://www.youtube.com/watch?v=e5nyQmaq4k4

Crypto may well be the biggest solution looking for a problem I've ever seen.

Apart from the obvious issues (eg energy expenditure) the one myth that needs to die about crypto is that it is extragovernmental and indictments such as this and the Bitfinex laundering case recently should underline that.

The simple fact is that the developed world could shut down what little utility cryptocurrencies (and NFTs) have tomorrow if they chose to. China banned mining and mining was gone immediately (largely moving to Kyrgystan it seems). Defenders will say you can't shut down the network and that might be true but it's irrelevant.

The threat of legal action will be enough to keep th evast majority of people away. And the weakness of any crypto is that at some point it has to interface with the real world or it's completely useless. Obvious example: the traditional financial system. Access to the US financial system is what allows the US government to exercise influence over European financial institutions to stop them, for example, dealing with sanctioned countries like Iran.

Meanwhile in other news, water is wet, the sky is blue, Putin is a tyrant with blood on his hands, and I'm SHOCKED, SHOCKED to find that GAMBLING is going on in here!

https://www.youtube.com/watch?v=SjbPi00k_ME

> Kumbhani is charged with conspiracy to commit wire fraud, wire fraud, conspiracy to commit commodity price manipulation, operation of an unlicensed money transmitting business, and conspiracy to commit international money laundering. If convicted of all counts, he faces a maximum total penalty of 70 years in prison.

Liberty Reserve operator Arthur Budovsky is serving his 20 year prison sentence, Kumbhani will likely serve 40+ years.

Liberty Reserve wasn't even incorporated in US or did a lot of business after getting booted but that didn't stop it from being used as money laundering.

Tether isn't very much different, LR/E-gold both tried various forms of insulation (LR not providing fiat on-ramp/off-ramp but through "verified" 3rd party).

In the end, the trail of money and cui bono ultimately indicted Arthur for facilitating money laundering and subverting US banking system. It's very likely that DOJ and other three letter agencies are utilizing Tether/Bitcoin/Monero as a honeypot to gather intelligence on the parties.

Imagine the wealth of information they are sitting on after capturing the hard drives of darknet marketplaces like Alphabay which were allegedly used to trace a former YC alumni's stolen Bitcoins.

Tether is a well known cable for moving money out of China and into real estate markets in the West, it's ironic that so many do not see the complete geopolitical ramifications: housing affordability has been hijacked to facilitate money exfiltration in authoritarian countries by the elites in the West, to make cheap goods.

In the West, lower and middle class unwittingly traded affordable housing for affordable consumer goods produced by authoritarian labor control and the beneficiaries of this were able to move their wealth out of reach from the same authoritarian government. Now that the musical chairs is ending, the same demographic in the West are being encouraged to become unwitting exit liquidity for the upper class. I predict this would have destabilizing effect on societies all over the world, especially countries that are over-leveraged and buying crypto on margin.

Bitcoin is like bit torrent. A technology that has legitimate use cases in theory, even can be really truly useful tech, but is used mostly for shady things.