SEC sues defunct crypto exchange BitConnect over alleged $2B scheme

Federal regulators sued BitConnect alleging that the cryptocurrency exchanged conducted a "fraudulent" and unregistered offering and sale of securities that succeeded in obtaining more than 325,000 Bitcoin (BTC-USD) or $2B from investors worldwide. The U.S. Securities and Exchange Commission claims in a new lawsuit that BitConnect and its founder established a worldwide network of "promoters" and rewarded them with commissions, which were largely concealed from investors, between January 2017 and January 2018, according to the suit. The lawsuit comes after the SEC announced in late May that it filed an action against five individuals associated with BitConnect. Business Insider reported last month that the SEC settled with three people involved in BitConnect's alleged lending scheme. The three individuals paid a total of $3.5M and 190 in bitcoin, without admitting or denying the allegations, according to the report. Earlier, Twitter testing ability for users to send tips with bitcoin, sources say.