EmpiresX 'Head Trader' Pleads Guilty for $100M Crypto Ponzi Scheme

The US Department of Justice announced on Thursday that one of the masterminds of the cryptocurrency Ponzi scheme, EmpiresX has pled guilty. The scheme defrauded investors of around $100 million.

Joshua David Nicholas was the 'Head Trader' of the cryptocurrency scheme. He admitted in court that he and others fraudulently promoted the cryptocurrency scheme to lure victims.

He pled guilty to one count of conspiracy to commit securities fraud and is now facing a maximum prison sentence of five years. However, his sentencing date has not been scheduled yet.

A Ponzi Scheme

EmpiresX claimed to be using a proprietary trading bot that used artificial and human intelligence for maximizing profitability for investors, which was a false representation. Further, to lure investors, fraudulently 'guaranteed' returns and promoted the scheme on social media platforms.

However, in reality, EmpiresX operated as a Ponzi scheme Ponzi Scheme A Ponzi scheme is a scam that looks to lure investors, ultimately paying profits to earlier investors with funds from more later investors.This form of fraud tricks victims into believing that products are instead generated from product sales or other means. In actuality, most investors are completely oblivious to the actual origin of incoming funds.One of the central attributes of a Ponzi scheme is the necessity of its ongoing nature, which is dependent on a steady flow of new contributions and A Ponzi scheme is a scam that looks to lure investors, ultimately paying profits to earlier investors with funds from more later investors.This form of fraud tricks victims into believing that products are instead generated from product sales or other means. In actuality, most investors are completely oblivious to the actual origin of incoming funds.One of the central attributes of a Ponzi scheme is the necessity of its ongoing nature, which is dependent on a steady flow of new contributions and Read this Term, it paid old investors from the proceeds collected from the new investors.

The perpetrators even showed screenshots of the company’s profitable account with a well-known electronic trading platform. 12:02
However, later it surfaced that EmpiresX did not hold the trading platform Trading Platform In the FX space, a currency trading platform is a software provided by brokers to their respective client base, garnering access as traders in the broader market. Most commonly, this reflects an online interface or mobile app, complete with tools for order processing.Every broker needs one or more trading platforms to accommodate the needs of different clients. Being the backbone of the company’s offering, a trading platform provides clients with quotes, a selection of instruments to trade, real In the FX space, a currency trading platform is a software provided by brokers to their respective client base, garnering access as traders in the broader market. Most commonly, this reflects an online interface or mobile app, complete with tools for order processing.Every broker needs one or more trading platforms to accommodate the needs of different clients. Being the backbone of the company’s offering, a trading platform provides clients with quotes, a selection of instruments to trade, real Read this Term accountable and the screenshots were fabricated.

They even created a fake website to show investors that they are trading with the collected proceeds. However, only $1 million of the investors' funds were sent to a futures trading account.

Additionally, the crypto scheme did not register for the offering and sale of securities in the United States, despite targeting Americans.

On top of that, the Commodity Futures Trading Commission filed a separate civil lawsuit against EmpiresX and its two masterminds, Nicholas and two Brazilian citizens, Emerson Pires and Flavio Goncalves.

However, the original CFTC complaint only measured the solicitation to be of at least $41.6 million, out of which more than $14.3 million were collected from US individuals. That complaint elaborated that the three masterminds misappropriated at least $5 million of the investors’ funds.