The Texas State Securities Board has issued a cease and desist order against Arkbit Capital for engaging in fraudulent cryptocurrency cloud mining activities.
According to the order, the Texas State Securities Board, led by Financial Examiner Alexis Cantrell, found that Arkbit Capital and its affiliated entities engaged in fraudulent activities, including using deceptive image and video manipulation techniques to promote their schemes. investment.
Arkbit Capital, Arkbit Capital Holdings, ABC Holdings LLC and ABC Mining (collectively “Arkbit”) falsely claimed to operate data centers in Arkansas for cloud mining of various cryptocurrencies.
It offered investments with promised daily returns of 1.6-2.8% for 120 days on digital asset deposits between USD 50 and USD 49,999.
The order also alleges that Arkbit Capital used a payment processor, CoinPayments.Net, to facilitate payments for its investment plans despite CoinPayments.Net's policy restricting users from certain jurisdictions, including the United States.
The Arkbit CoinPayments account holder was found to be Paras Khivesara, located in Hyderabad, India, not Arkansas.
One of the doctored videos used by Arkbit Capital included a video purportedly showing its CEO and founder speaking at a cryptocurrency conference in Austin, Texas.
However, the Texas State Securities Board found no evidence that Delmar Estabrook or Arkbit Capital were present at the conference.
The Texas State Securities Board, through Joe Rotunda, Director of the Division of Enforcement, urges the public to remain vigilant when dealing with social media investment opportunities and to thoroughly investigate any investment before sending money.
This is one of several cases of cryptocurrency-related Ponzi schemes that have emerged in the United States over the past year.
On March 15, the US Securities Commission (SEC) dismantled a $300 million Ponzi scheme under the guise of a cryptocurrency trading platform called CryptoFX, which targeted cryptocurrency investors from the Latino community in The USA.
A few days later, on March 18, a New York jury convicted two individuals who acted as promoters of the now-collapsed IcomTech cryptocurrency mining and trading scheme.
Most recently, on April 4, Irina Dilkinska, the former head of legal and compliance for the multibillion-dollar OneCoin fraud scheme, received a four-year prison sentence after admitting her role in laundering millions of dollars.
