Manipulation of Cryptocurrency Rates Recognized as Fraud
Date: 2024-06-27 Author: Oliver Abernathy Categories: CRYPTO PAYMENTS
Historic US Jury Decision
For the first time in history, jurors in the United States recognized cryptocurrency as a security, which made it possible to qualify the manipulation of its rate as securities fraud. This landmark ruling came on June 25 when Shane Hampton and Michael Caine were found guilty of fraud involving the Hydro (HYDRO) cryptocurrency.
Shane Hampton and his accomplice Michael Kane, who held senior positions at Hydrogen Technology, were convicted of manipulating the rate of cryptocurrency. Hampton was sentenced to two years and eleven months in prison, and Kane was sentenced to three years and nine months in prison.
Manipulation Techniques
According to prosecutors, the defendants used bots to perform fictitious trading operations known as wash trading to artificially inflate the value of Hydro's cryptocurrency. These transactions included trading transactions amounting to approximately $7 million, as well as the creation and cancellation of orders to buy and sell tokens valued at over $300 million.
The manipulations of the attackers created a false impression among investors about the high popularity of the Hydro cryptocurrency. This has attracted significant capital investment into the digital asset. When the price of HYDRO tokens increased, scammers began selling them, earning approximately $2 million in 10 months.
Importance of the Decision
Recognizing cryptocurrency as a security and classifying manipulation as securities fraud has significant implications for the cryptocurrency market. This decision could set a precedent for future cases and regulation of cryptocurrency transactions, which will help protect investors from such schemes.
The historic jury decision in the United States, finding manipulation of cryptocurrency prices to be securities fraud and the conviction of Shane Hampton and Michael Caine, underscores the importance of regulating the cryptocurrency market. This decision not only protects the interests of investors, but also sets new standards for fair and transparent trading of digital assets.
