Three crypto companies and 15 people charged with massive fraud and market manipulation. 🕵️‍♂️ The FBI has launched an unprecedented investigation by creating a new digital token to expose criminal activity in the sector.

Federal prosecutors in Boston announced charges against Gotbit, ZM Quant, and CLS Global, as well as their leaders and employees. The indictment resulted in four arrests, five guilty pleas, and the seizure of more than $25 million in cryptocurrency.

US Attorney Joshua Levy said the defendants engaged in sham trades to artificially inflate token trading volumes, leaving innocent investors high and dry.

The FBI created a crypto company called NexFundAI that operated a token on the Ethereum blockchain. ZM Quant, CLS Global, and MyTrade agreed to manipulate the token, which was closely monitored to prevent retail investors from buying it.

The SEC also filed civil lawsuits. Among the companies charged was Saitama, whose market value soared to $7.5 billion thanks to token manipulation by its executives, including CEO Manpreet Singh Kohli, who was arrested in the UK.

Gotbit CEO Alexey Andriounin was detained in Portugal, and two of his employees in Russia were also charged.Prosecutors in Boston said Gotbit engaged in "wash trading" and other manipulative practices from 2018 to 2024.

Several other individuals, including Liu Zhou and Ricky Liu, who were involved in the market-making operations, have also been charged.