former executive Hydrogen Technology CorporationShane Hampton has been found guilty by a federal jury in Florida of orchestrating a scheme to manipulate the price of Hydro, the company’s native cryptocurrency token. The conviction adds to the company’s existing legal issues with U.S. securities regulators, which were resolved in April 2023 with a $2.8 million payment.
Automated cryptocurrency price manipulation tactics revealed
Shane Hampton and his associates utilized automated trading bots contracted through a third-party company to manipulate the price of Hydro tokens on US-based cryptocurrency exchanges. This bot carried out fraudulent activities. “Wash Trade” and “Spoof Transaction” From October 2018 to April 2019, the market was flooded with fake orders totaling $7 million and $300 million respectively.
Hampton’s sentencing is scheduled for April 29, and he faces up to five years in prison for the conspiracy to manipulate securities prices and up to 20 years in prison for the wire fraud conspiracy.
The company’s CEO, Michael Kane, faced legal trouble in September 2022 for unregistered sales of Hydro tokens and manipulation of trading volume and prices, generating more than $2 million in revenue for Hydrogen. Likewise, engineer Andrew Chorlian has pleaded guilty to conspiracy charges related to wire fraud and price manipulation and is awaiting sentencing.
The announcement of this conviction was jointly announced by legal authorities from the Southern Florida Department of Justice’s Criminal Division and the FBI’s Criminal Investigation Division.
Hydrogen Technology Corp and its impact on the cryptocurrency market
Hampton’s beliefs highlight the challenges cryptocurrency companies face in maintaining transparency and integrity within the market. This highlights the importance of regulatory oversight to prevent fraudulent activity that could harm investors and erode trust in the cryptocurrency ecosystem.
This case also highlights the growing scrutiny from regulators like the SEC and indicates the need for more stringent enforcement measures to curb illegal activity in the cryptocurrency space.
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