A federal court ordered $5.52M in penalties against operators of the fake NanoBit crypto platform, which used WhatsApp groups and fake ICOs to lure investors. The SEC continues to target similar group-chat scams.
Alpha Score of 65 reflects moderate overall profile with strong momentum, strong value, weak quality, moderate sentiment.
The U.S. Securities and Exchange Commission has secured a final default judgment against the operators of a fake crypto trading platform. The U.S. District Court for the Eastern District of New York entered the order on June 16, nearly two years after the agency filed its complaint.
The court ordered NanoBit Limited, Radiant Horizons Limited, Sweet Karma Fashion Inc., Zhao Tropical Deli Inc., Jiajie Liu and Hua Zhao to pay a combined $5.52 million in penalties, disgorgement and interest.
The SEC alleged that NanoBit never functioned as a real trading venue. Operators used social media apps to find investors, then moved conversations to WhatsApp groups. They posed as financial professionals and built trust over time, the regulator said. The group promoted fake initial coin offerings and claimed that an affiliate, NanobitUS Securities, was registered with the SEC. It was not.
Investors saw platform interfaces that appeared to show crypto prices, account balances and order execution. "No transactions took place on the NanoBit platform," the SEC said. Investor funds instead went to the scheme participants. More than $2 million was wired to bank accounts in Hong Kong, while hundreds of thousands of dollars in crypto assets were misused.
The case adds to a string of enforcement actions targeting crypto fraud even as U.S. regulators adjust their broader approach to digital asset policy. The SEC had already named NanoBit and another platform, CoinW6, among relationship investment scam cases in its 2024 enforcement review. In May, the SEC charged a Texas resident over an alleged $12.3 million AI crypto arbitrage scheme involving a trading robot. TRM Labs warned this month that fraudsters had created World Cup-related crypto scams, including fake ticketing sites and fixed-match betting operations.
The SEC has also published investor alerts specifically warning about group-chat scams. In a December 2025 notice, Investor.gov said people should "never rely solely on information from group chats" when making investment decisions and should verify the background of anyone offering or selling investments.
Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.