- My Big Coin founder Randall Crater will be jailed for 8 years after being found guilty of fraud.
- Prosecutors initially aimed for a 13-year prison sentence as a warning for future crypto scammers.
- The court ordered Crater to surrender $7.7 million deemed to be ill-gotten.
Randall Crater, founder of a now-defunct cryptocurrency scheme named My Big Coin, has been charged with fraud for promoting the crypto via deceptive means. He will now be incarcerated for 8 years, according to Reuters.
Crater was found guilty of wire fraud and unlawful monetary transactions and was accused of causing investors and customers to lose $7.5 million through false claims about the virtual currency. The money was allegedly used to purchase luxury items.
Initially, prosecutors aimed for a 13-year prison term to send a warning to those interested in devising a similar scheme. In legal terms, this is more popularly known as a precedent.
However, the presiding judge concluded that the 13-year prison term request was excessive. On the other hand, the 30-month prison term sought by the defendant was insufficient. The defendant’s false claims, including that the virtual currency was backed by gold, were also considered in the sentencing.
The judge stated that while cryptocurrency is a new enterprise, the fraud committed by the defendant was age-old. Hence, Crater was sentenced to 100 months in prison and ordered to forfeit $7.7 million.
Many expect Crater to appeal, apologizing in court and stating that he never intended to defraud anyone. The prosecution was a result of a case by the US Commodity Futures Trading Commission (CFTC) and resulted in one of the first court rulings recognizing virtual currency as a commodity under the regulator’s jurisdiction.
