In a major undercover operation, the FBI created a fake cryptocurrency company to expose illegal market manipulation.
The Department of Justice announced charges against 18 individuals and companies involved in wash trading and market manipulation schemes. Wash trading is the practice of buying and selling a cryptocurrency to artificially inflate its value, often as part of a pump-and-dump strategy that misleads investors.
As part of the sting, the FBI launched “NexFundAI,” a fake company that developed its own cryptocurrency token called “NEXF.” This allowed agents to solicit illegal services from fraudsters. The operation led to charges against three companies—ZM Quant, CLS Global FZC, and MyTrade MM—for manipulating crypto markets.
The FBI seized over $25 million in cryptocurrency and shut down trading bots responsible for millions of dollars worth of wash trades across 60 different tokens. They also arrested the CEO of Gotbit, a company involved in market manipulation from 2018 to 2024.
The NexFundAI website now states that it was created by the FBI as part of the investigation into crypto fraud.
