Scams

In February 2026, a federal judge in the Eastern District of Virginia sentenced Praetorian Group International founder Ramil Ventura Palafox to 20 years for wire fraud and concealment money laundering linked to a Bitcoin Ponzi scheme. Prosecutors said the operation raised more than $201 million, took in at least 8,198 BTC, and drew over 90,000 investors, with confirmed losses of at least $62.7 million.

Ripple CTO Emeritus David Schwartz stated on X that native XRP has no issuer and that the XRP Ledger's XLS-39 "clawback" does not apply to XRP itself. The remark followed a post from the Global Trade Finance (GTF) aggregator claiming its VC wallet was compromised by a "fake NFT offer" and "XRP Voucher Scam," affecting a major LP holder.

An address linked to the 2023 Mixin Network exploit resumed activity, moving 2,005 ETH to Tornado Cash on February 13, 2026, according to Lookonchain. Three new wallets then received 2,087 ETH and sold at around $1,933, while Ethereum traded near $1,971.30, implying sales below spot. CoinMarketCap later showed ETH at $1,970, down 1.3% in 24 hours.

French police arrested three suspects after an attempted break-in targeting a senior figure at Binance’s French unit. According to RTL, around 7:00 am CET Thursday, three armed, hooded individuals tried to enter an apartment in Val-de-Marne and were detained two hours later in Hauts-de-Seine; Binance confirmed a home invasion involving one employee but did not identify the person.

In Virginia, a federal court sentenced Praetorian Group International chief executive Ramil Ventura Palafox, 61, to 20 years in prison for operating a Bitcoin-based Ponzi scheme that raised over $200 million from investors between December 2019 and October 2021. Prosecutors said the operation took in more than 8,198 BTC and over $201 million in total, caused at least $62.7 million in losses, and falsely promised daily returns of up to 3%.

Crypto flows to suspected human trafficking networks climbed 85% during 2025, according to a Chainalysis report released Thursday. The firm said volumes reached hundreds of millions of dollars, with networks concentrated in Southeast Asia and closely linked to scam compounds, online casinos and Chinese-language laundering groups. It added that blockchain transparency could help investigators track patterns and intervene.

Israeli authorities detained a military reservist and a civilian after allegedly using classified information to bet on Polymarket about strikes on Iran. Prosecutors plan charges including security offenses, bribery, and obstruction, while reports indicate a June 2025 betting account earned over $152,300, though its link to the arrests remains unclear.

On February 12, South Korea’s Financial Supervisory Service urged Bithumb customers to ignore URLs in compensation notices, saying every link is fraudulent because no payout schedule has been announced. The alert follows a transfer mistake that sent 620,000 Bitcoins to users; the exchange says it has recovered 99.7% and outlined fee waivers and 110% refunds.

On Wednesday, the U.S. Department of Justice said Paxful was ordered to pay a $4 million fine following its December guilty plea to conspiring to promote illegal prostitution, transmit criminal proceeds and breach anti‑money‑laundering rules. Prosecutors added the platform marketed itself as non‑KYC, handled over 26 million trades worth nearly $3 billion from January 2017 to September 2019, and agreed an appropriate penalty of $112.5 million but was assessed as unable to pay more than $4 million.

Former SafeMoon CEO Braden Karony has been sentenced in February 2026 to 100 months in prison for diverting $9 million from the platform's liquidity pool in 2021 to fund personal luxury purchases. He was also ordered to forfeit about $7.5 million, while ex-CTO Thomas Smith has pleaded guilty and awaits sentencing, and platform creator Kyle Nagy remains at large. The case adds to a growing list of high-profile crypto executives convicted over misconduct during the 2021‑2022 market cycle.