SEC Sues Texas Resident Nathan Fuller for Crypto Fraud
The U.S. Securities and Exchange Commission (SEC) has officially sued Texas resident Nathan Fuller, accusing him of committing crypto fraud through entities such as Privvy Investments, raising approximately $12.3 million from about 150 investors.
Fuller claimed to use a self-developed AI trading robot for high-frequency arbitrage trading, promising returns of 40%-50% within 30-45 days, with guaranteed profits exceeding 100% in as little as 21 days.
Market mechanisms have led crypto investors to accelerate withdrawals from high-commitment AI trading projects; event-driven funds are flowing out of conceptual fraud projects; compliant crypto platforms and genuine AI application projects are benefiting, while high-return AI arbitrage scams and related entities are under pressure.
Source: Public Information
ABAB AI Insight
Nathan Fuller attracted funds using the concept of an AI trading robot from October 2022 to mid-2024. Previously, several similar crypto fraud cases centered around 'AI high-frequency arbitrage.' In this case, Fuller misappropriated at least $6.2 million for personal expenses and used $5.5 million for Ponzi-style payouts, while falsifying reports to mislead investors.
In terms of capital flow, Fuller primarily used the raised funds to maintain the operation of the scam rather than for a real trading system, typically exploiting investors' blind trust in AI technology to quickly amass wealth, ultimately leading to significant losses for investors.
Similar 'AI quantitative' crypto fraud cases from 2022-2024, along with the SEC's increased crackdown on false AI promotional projects in recent years; the current crypto market is transitioning from AI concept hype to strict regulation and genuine technology verification.
Essentially, this represents a regulatory shift, with the lawsuit concentrating market funds from false high-return AI crypto projects to compliant and transparent platforms. The mechanism is that high-commitment returns plus fund misappropriation are classic Ponzi characteristics. The SEC's actions help purify the market and rebuild investor confidence in genuine AI applications.
ABAB News · Cognitive Law
An AI that promises 100% returns in 21 days has never been a trading robot, but rather a withdrawal machine. True AI generates compound interest; scammers only use the term AI to create fraud. As regulation begins to clear out AI crypto scams, the industry bubble has reached the harvest season.