An Illinois district court judge said he agreed with the Commodity Futures Trading Commission (CFTC) in a crypto Ponzi case, labeling two lesser-known altcoins as commodities. The Ponzi scheme involved Sam Ikkurty, an Oregon man, and several of his companies. The scheme defrauded victims by promising 15% “fixed returns” per year on investments in “digital asset commodities.”

This included Bitcoin (BTC) and Ether (ETH), as well as altcoins such as Olympus (OHM) and KlimaDAO (KLIMA). The CFTC stated that these virtual currencies fall into the same general class as Bitcoin and are traded on regulated futures.

KLIMA is the governance token of Klima DAO, a decentralized autonomous organization that solves “coordination” problems in climate finance. OHM is the governance token of OlympusDAO, an organization that aims to create a community-owned decentralized reserve currency.

The CFTC stated that Ikkurty only invested in stable crypto assets to potential participants and exaggerated stories of his previous successes to gain investors' trust. However, Ikkurty constantly gave misleading information about the performance of his fund, deliberately omitting the fact that the value of his fund dropped 98.99% in a few months.

Judge Rowland ordered Ikkurty to pay $83.7 million in damages and $36.9 million in ill-gotten gains. The CFTC first charged Ikkurty and Ravishankar Avadhanam in May 2022 with fraud and failure to register with their agency.

What do you think about this? We are waiting your comments.#blockchain#crypto #CFTC