According to ChainCatcher, several crypto investors said they were unable to withdraw their funds in the Gray Digital fund, with an estimated $8 million trapped.
Gray Digital has attracted about 1,000 depositors with a total deposit of more than $42 million since its establishment in June 2022. Six investors revealed that their withdrawal requests were rejected.
Gauvin, the head of the fund, said on Discord that the problem stemmed from large-scale withdrawals and conspiracy theories by bad actors, which led to the freezing of its bank account.
The U.S. Securities and Exchange Commission (SEC) has launched an investigation into the platform and issued subpoenas to relevant parties.