The Commodity Futures Trading Commission has won a legal battle against a New York resident and his company for running a Ponzi scheme centered around bitcoin.
Between 2014 and early 2016, Gelfman Blueprint, Inc. (GBI) and its CEO Nicholas Gelfman ran a scheme wherein they successfully solicited $600,000 from 80 customers, claiming that customers would earn money through the company's proprietary trading algorithm.
Instead, client funds were used to repay previous clients, thereby perpetuating the scheme with the newly-accrued money. This was the first anti-fraud enforcement action that the CFTC brought related to bitcoin, according to statements.