Tag: hydro token

Hydrogen Technology Corporation Settles Crypto Manipulation Lawsuit

Hydrogen Technology Corporation, a firm accused of manipulating the price of cryptocurrencies, has settled a seven-month-long lawsuit with the Securities and Exchange Commission (SEC) for $2.8 million. The SEC had filed a complaint against Hydrogen and its former CEO, Michael Ross Kane, in September, alleging that they manipulated the volume and price of the firm’s ERC-20 token, Hydro (HYDRO), by using its market maker, Moonwalkers Trading Limited.

On April 20, a New York District Court Judge ordered Hydrogen and Kane to pay $2.8 million in remedies and civil penalties. The payment comprises approximately $1.5 million in “disgorged” profits, which refers to gains made from unlawful conduct, as well as a penalty of more than $1 million. Additionally, Kane agreed to pay an individual fine of approximately $260,000, and the remaining amount is made up of prejudgment interest.

The SEC’s complaint alleged that Kane and Moonwalkers CEO Tyler Ostern worked together to manipulate the volume and price of Hydro’s token, following its distribution through airdrops, bounty programs, and direct-to-market sales in 2018. According to the complaint, Ostern sold the tokens in an “artificially inflated market,” which allowed Hydrogen to net more than $2 million in profit.

A day after the complaint was filed, Ostern settled the case for $41,000. Both Hydrogen and Kane are now bound by the conditions of the settlement, which prevents them from disputing the charges levied against them by the SEC.

As part of the settlement, Hydrogen and Kane are also prohibited from selling any additional cryptocurrency until the Hydro tokens have passed the Howey test and received further approval from the SEC. However, Kane is still permitted to participate in the wider cryptocurrency market, meaning he can still buy and sell crypto assets for personal gain.

The settlement of the lawsuit marks a significant win for the SEC, which has been cracking down on cryptocurrency-related fraud and misconduct. The case also serves as a reminder to cryptocurrency companies and their executives to comply with securities laws and regulations.

It is worth noting that the Howey test mentioned in the settlement is a legal test used to determine whether an asset is a security. If an asset meets the criteria of the test, it is considered a security and must comply with securities laws and regulations. This means that Hydrogen and Kane cannot sell any additional cryptocurrency until the SEC approves the Hydro tokens as a security.

In conclusion, the settlement of the cryptocurrency manipulation lawsuit brought against Hydrogen Technology Corporation and its former CEO is a significant development in the ongoing effort to regulate the cryptocurrency market. The settlement serves as a reminder to companies and their executives to comply with securities laws and regulations to avoid legal action by regulators.

5 Charged for Hydro Token Market Manipulation

The US Department of Justice (DOJ) has charged five individuals with conspiring to manipulate the market in relation to an alleged scheme involving the Hydro (HYDRO) token. The charges include conspiracy to commit securities price manipulation and wire fraud. The three individuals charged with manipulating the market for Hydro are Michael Ross Kane, the former CEO of Hydrogen Technology Corp.; Shane Hampton, Hydrogen’s chief of financial engineering; and George Wolvaardt. The other two individuals were charged separately for their alleged roles in the scheme. Tyler Ostern, the former CEO of Moonwalkers, and Andrew Chorlian, a blockchain engineer from Hydrogen Technology Corp., were also charged for their involvement in the alleged manipulation scheme.

According to the indictment, from June 2018 through April 2019, Kane, Hampton, and Wolvaardt defrauded market participants looking to trade the Hydro tokens that Hydrogen issued. Wolvaardt, who was the chief technology officer for a market-making firm called Moonwalkers Trading Limited, designed a trading bot that executed a number of high-value “spoof orders” at obscure intervals to make it appear as though there was high demand for the token. The bot also bought and sold large volumes of the token from the same account, a practice known as wash trading.

The alleged manipulation of the Hydro token price resulted in the co-conspirators making an approximate total of $2 million in ill-gotten profits. The DOJ claims that following the artificial manipulation of the token’s price, the co-conspirators sold large chunks of their holdings.

Kane, Hampton, and Wolvaardt have each been charged with one count of conspiracy to commit securities price manipulation, one count of conspiracy to commit wire fraud, and two counts of wire fraud. If found guilty on all charges, they each face a maximum penalty of five years imprisonment in relation to the conspiracy to commit securities price manipulation charge and a staggering 20 years in prison on each of the other charges. Ostern and Chorlian have each been charged with one count of conspiracy to commit securities price manipulation and wire fraud. If found guilty, they face a maximum penalty of five years in prison.

In a separate case brought by the Securities and Exchange Commission, Hydrogen Technology Corporation and former CEO Michael Ross Kane were ordered to pay $2.8 million in remedies and civil penalties. On April 20, a New York District Court judge ruled against Hydrogen Technology Corporation and Kane in the case. The SEC alleged that Hydrogen and Kane had made false and misleading statements to investors about the company’s financial performance and the development of its technology.

In conclusion, the charges against the five individuals for market manipulation of the Hydro token highlight the importance of transparency and fairness in the cryptocurrency market. The DOJ’s efforts to prosecute individuals who engage in fraudulent activities in the cryptocurrency market sends a strong message that such activities will not be tolerated.

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