Bitcoin Mining Schemes Under Scrutiny Amid Fraud Allegations

The owner of VBit Technologies Corp., Danh C. Vo, a 37-year-old from Philadelphia, is facing serious allegations of defrauding investors out of more than 48.5 million dollars. According to a complaint filed by the U.S.

Securities and Exchange Commission, Vo launched VBit in 2018, marketing it as a passive income opportunity through bitcoin mining. Between December 2018 and February 2022, he raised 95.6 million dollars from about 6,400 investors, claiming to operate substantial computing power for bitcoin mining.

However, the SEC found that VBit only mined approximately 425.2 bitcoin during that time, worth around 36 million dollars, and operated only a fraction of the mining rigs it claimed. Vo allegedly misled investors about VBit's operations and finances, continued to accept new investments while lacking the capacity to fulfill contracts, and transferred millions to personal accounts, reportedly using the money for gambling and to support family and friends.

After learning of the SEC investigation, Vo fled to Vietnam in November 2021. He is now charged with multiple violations of SEC regulations, and the agency is seeking a jury trial and an order for him to return the misappropriated funds.

Vo's new company, Advanced Mining Group, was also named in the complaint, and both companies are accused of failing to register with the SEC as required. The SEC is also pursuing civil penalties against Vo and his associates.

The case highlights the risks associated with investments in cryptocurrency mining schemes and the need for increased regulatory oversight.