The case, initiated by the Department of Justice, was the first criminal prosecution of financial companies for manipulation of the crypto market. The FBI’s approach was to create a NexFundAI token on the Ethereum blockchain and set up a front company to engage with alleged manipulators who used various schemes, including the use of trading bots, to artificially inflate the value of cryptocurrencies.
According to FBI special agent Jody Cohen in Boston, the operation was aimed at identifying tactics that artificially increased token prices. Investigators interacted with “market makers”; One of them disclosed that he used bots to simultaneously place trades in order to create fake trading volumes.
Five defendants have already pleaded guilty.
Source: Ferra
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