The Securities and Exchange Commission secured a final judgment against NanoBit Limited and five affiliated entities and individuals on June 16, after a federal court in New York found they operated a fake cryptocurrency trading platform that stole money from at least 18 investors between 2023 and 2024.
The SEC announced the outcome Monday, nearly two years after it filed its initial complaint against NanoBit in September 2024. The US District Court for the Eastern District of New York entered the judgment by default against four entities and two individuals.
The scheme began on social media. Investors were contacted on Instagram and then added to WhatsApp groups, where operators posed as financial industry professionals to build trust. Victims were directed to deposit funds into the supposed NanoBit crypto trading platform. A fake dashboard displayed fabricated returns to create the appearance that deposits were growing. When investors sought to withdraw their money, they were met with excuses, asked to pay large fees, or removed from the WhatsApp groups for questioning the platform.
"No transactions took place on the NanoBit platform and investors' funds in fact went to scheme participants who wired more than $2 million to bank accounts in Hong Kong and misappropriated hundreds of thousands of dollars' worth of investors' crypto assets," the SEC alleged.
NanoBit also falsely claimed that its affiliate, NanobitUS Securities, was an SEC-registered broker, and promoted fake initial coin offerings with promises of substantial returns to further draw in investors.
How the platform kept investors from leaving
The fraud relied on a layered deception that made it difficult for victims to recognize their losses early. Investors first saw an account dashboard that showed rising balances, which created confidence in the platform and encouraged larger deposits. Once they tried to exit, the dynamic shifted. Withdrawal requests were rejected or delayed with explanations the SEC described as excuses. Others were told they needed to pay substantial fees before funds could be released. Investors who pushed back or questioned the platform's legitimacy were removed from the WhatsApp groups entirely, cutting off communication with the operators.
The SEC alleged that NanoBit's fake broker claim and its fabricated ICO promotions served the same purpose: preventing early skepticism from forming among new recruits before deposits were made.
What the court ordered each defendant to pay
The final judgment permanently bars all defendants from participating in the issuance, purchase, or sale of securities. NanoBit Limited was ordered to pay disgorgement of $532,649, prejudgment interest of $81,957, and a civil penalty of $1,182,251, totaling approximately $1.8 million.
Three affiliated entities, Radiant Horizons, Sweet Karma, and Zhao Deli, were each ordered to pay a separate $1,182,251 civil penalty. Jiajie Liu, identified as one of the scheme's main orchestrators, was ordered to pay disgorgement of $60,603, prejudgment interest of $9,485, and a penalty of $50,000. A second individual, Zhao, was ordered to pay disgorgement of $4,500, prejudgment interest of $704, and a $50,000 penalty.
The combined total across all defendants reaches approximately $5.4 million.
The SEC's litigation was conducted by Todd Brody and Jeremy Brandt, with assistance from Neil Hendelman, and supervised by Alexander Vasilescu, Rebecca Reilly, and Sheldon L. Pollock of the SEC's New York Regional Office. The Division of Enforcement's Cyber and Emerging Technologies Unit also assisted through Nicholas Bohmann.
The NanoBit case in the context of broader SEC crypto enforcement
The NanoBit judgment sits alongside a pattern of enforcement actions the SEC has taken against crypto-linked fraud even as the agency has softened its regulatory stance toward crypto companies more broadly and revised what it considers a securities offering.
On May 29, the SEC charged a Texas man with running a scheme that raised more than $12 million from roughly 150 investors through false claims tied to AI-powered trading bots that purportedly generated guaranteed returns. In April, the agency charged crypto executive Donald Basile and two companies he controlled for raising approximately $16 million from hundreds of investors through false statements connected to a token called Bitcoin Latinum.
The SEC's Office of Investor Education and Assistance issued an alert alongside the NanoBit announcement, warning that fraudsters use popular social media platforms and messaging apps to lure investors into scams. The SEC encouraged investors to use Investor.gov to verify the background of anyone offering an investment before committing funds.
Roman Zaika
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