HyperVerse Promoter Arrested for Operating Unlicensed Money-Transmitting Business
Rodney Burton, also known as “Rodney Bitcoin,” has been arrested for his involvement in a complex cryptocurrency investment scheme. Court documents reveal that Burton has been charged with operating and conspiring to operate an unlicensed money-transmitting business. Although he was apprehended in Florida, his case is awaiting transfer to Maryland.
The HyperFund Ponzi Scheme and the Mysterious CEO
Burton allegedly promoted HyperFund, an unregulated investment company that was part of a crypto Ponzi scheme operated by Ryan Xu and Sam Lee. Both Xu and Lee were directors of Blockchain Global, a bitcoin mining company that collapsed, leaving behind a $58 million debt. The investigation by The Guardian also revealed doubts about the existence of Steven Reece Lewis, who was claimed to be the CEO of Blockchain Global but had no record of attending the University of Leeds or the University of Cambridge.
The Fraudulent Operations of HyperFund
According to an affidavit by the IRS, HyperFund operated by collecting daily fees from members who believed they were investing in large-scale crypto mining operations. However, these operations were fake, and any rewards paid to investors were funded by new investors’ money. Burton received over $7.8 million in wire transfers from customers who thought they were investing in HyperFund between June 2020 and January 2022.
The Impact of the HyperVerse Scam
Chainalysis estimates that the HyperVerse scam resulted in approximately $1.3 billion in customer losses. While several countries have raised concerns about HyperVerse’s Ponzi scheme, Australian regulators have yet to take formal action against the company. Burton’s arrest is the first related to the international HyperVerse scheme, and it remains uncertain whether Xu and Lee will face charges.
Hot Take: Lack of Accountability in the Crypto Community
The arrest of Rodney Burton, a promoter of the HyperFund Ponzi scheme, highlights the lack of accountability in the crypto community. Despite suspicions raised by various countries, Australian regulators have not taken any formal action against HyperVerse. This case serves as a reminder to be cautious when investing in unregulated cryptocurrency schemes and to advocate for stronger regulatory measures to protect investors from fraudulent activities.
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