In the latest news in cryptocurrency world, John Bigatton banned by regulators in Australia from operating in the financial sector. The reason was his involvement in the Bitconnect crypto scam.
The Australian Securities and Investment Commission (ASIC) banned John Louis Anthony Bigatton, who was the Director of Australian Promotions for the Bitconnect crypto scam.
John Bigatton banned by regulators in Australia due to his participation in Bitconnect scam
In line with Wallebi, the ASIC asked the Federal court in Australia to freeze John Bigatton accounts and assets and place him to traveling blacklist.
Recently, the regulators put one step further and banned Bigatton from participating in any financial activities.
John Bigatton was the Director of Australian Promotions at Bitconnect from August 2017 to January 2018.
ASIC reported that Bigatton provided unlicensed financial product advice. In addition, he engaged in conduct, which was likely to misleading investors.
The BitConnect scam story
Bitconnect launched in 2016. It offered high daily return to investors, if, they trade their Bitcoins or other cryptocurrencies for the Bitconnect tokens on its exchange. The profit depended on two factors. First the number of coins that the user invested in the platform. Second, the number of people he invited as a new user to the platform. In fact, they created a multi-level marketing scheme. Something like a Ponzi scheme.
The tempting 1% daily profit, attracted a lot of people to this platform. The directors claimed that they trade Bitcoin when the price pumps and dumps and make a profit. So, the company will share the profit with the investors.
After a while, the Bitconnect Token (BCC) price raised significantly. It experienced its all-time high at $500 with the total market cap of around $3 billion.
After that, Bitconnect identified by Texas Securities Commissioners as a fraud. Due to this announcement from TSC, the Bitconnect closed the exchange and made it impossible for the investors to withdraw money from the platform.