Published on juli 5, 2024, 12:30 am
Image source: Fox News
```json [ "An Illinois judge sides with CFTC in crypto fraud case, labeling OHM and KLIMA as commodities due to a Ponzi scheme involving digital assets. Scammer Sam Ikkurty faces over $120m in fines for deceiving investors and running a fraudulent scheme.", "KlimaDAO Japan plans to launch a carbon credit marketplace with Progmat, separate from the ongoing case." ] ```
An Illinois judge has ruled in favor of the Commodity Futures Trading Commission in a cryptocurrency fraud case, designating two alternative coins, OHM and KLIMA, as commodities.
An Illinois district court judge supported the United States Commodity Futures Trading Commission (CFTC) in a cryptocurrency Ponzi scheme lawsuit, categorizing two lesser-known alternative coins as commodities. The fraudulent scheme involved Sam Ikkurty from Oregon and various of his companies. Investors were deceived with promises of consistent yearly returns of 15% by investing in “digital asset commodities” like Bitcoin (BTC), Ether (ETH), Olympus (OHM), and KlimaDAO (KLIMA),all acknowledged as commodities in the court order.
The CFTC highlighted that these virtual currencies are akin to Bitcoin, which has regulated futures trading. KLIMA serves as the governance token for KlimaDAO, a decentralized autonomous organization aiming to address coordination challenges in climate finance. As per CoinGecko data, KLIMA’s trading value stands at $3.55 currently, significantly dropped from its peak of $3,777 on Oct. 21, 2021.
OHM functions as the governance token for OlympusDAO, an entity focused on establishing a community-owned decentralized reserve currency. In July 3 statement, the CFTC declared that Ikkurty misled potential participants by claiming he solely invested in stable crypto assets and misrepresented his past successes to win investors’ trust. However, rather than distributing profits to participants, Ikkurty operated a scheme resembling a Ponzi system by consistently distorting his fund’s performance data and concealing over a 98.99% decrease in its value within a short period.
Furthermore, investigations revealed that Ikkurty transferred substantial funds to initial investors to prevent them from experiencing losses; consequently causing a $20 million deficit for investors participating in the alleged carbon offset plan. The CFTC also highlighted Ikkurty’s prior loss of all personal Bitcoin holdings due to hacking.
Judge Mary Rowland mandated restitution exceeding $83.7 million along with disgorgement payment of $36.9 million from Ikkurty. This ruling followed accusations made by the CFTC against Ikkurty and Ravishankar Avadhanam for fraudulence and failure to register with their agency back in May 2022.
In another development related to these altcoins but separate from this case, it was announced that KlimaDAO Japan is set to launch a carbon credit marketplace with Progmat.
Original article posted by Fox News
