Trendon Shavers, a Texas based individual has pleaded guilty to the charges of running a bitcoin Ponzi scheme. He was accused of defrauding investors by encouraging them to invest bitcoins into an elaborate scheme.
Bitcoin has many firsts in its credit, but this is one milestone the digital currency could have done without. Trendon Shavers’ case is going into records as being the first criminal securities fraud case involving bitcoin. He founded an organization called Bitcoin Savings and Trust, through which he raised over $4.5 million in bitcoin from numerous investors only to misappropriate it later.
Trendon Shavers had convinced investors by promising returns at a rate of 7 percent per week which translates to over 3641 percent per year. As a result people had invested at least 764,000 bitcoins in the platform. In the guilty plea before the federal court judge. According to Reuters, Trendon Shavers confessed to wrongdoings on his part and apologized for the same. He was quoted saying “I know what I did was wrong, and I’m very sorry.” His sentencing is scheduled on 3 February, 2016.
According to the plea deal agreed upon by the parties, Trendon Shavers will not be appealing