The CFTC has sued Gelfman Blueprint Inc. and its CEO Nicholas Gelfman for running a bitcoin Ponzi scheme that took more than $600,000 from about 80 investors between January 2014 and January 2016. Th
The CFTC has sued Gelfman Blueprint Inc. and its CEO Nicholas Gelfman for running a bitcoin Ponzi scheme that took more than $600,000 from about 80 investors between January 2014 and January 2016.
The company promised 7-9% monthly returns from a pooled fund it claimed employed a high-frequency algorithmic strategy, operating under the name Jigsaw. The money never touched any real trades. Instead, the defendants created false performance reports to mask losses and moved investor funds into their own pockets, a core feature of any Ponzi scheme.
The Jigsaw account records show trades were rare and unprofitable. Gelfman went further. He staged a fake computer hack to cover his tracks. The CFTC complaint alleges the defendants took virtually all $600,000.
"The defendants here preyed on customers interested in virtual currency, promising them the opportunity to invest in Bitcoin when in reality they only bought into the defendants' Ponzi scheme," said James McDonald, the CFTC's enforcement director. "We will continue to work hard to identify and remove bad actors from these markets."
Gelfman and his company face demands for restitution to victims, disgorgement of unlawful gains, civil penalties, and permanent trading bans.
The case joins a pattern of fraud tied to crypto investment claims. In June, the SEC secured a settlement against GAW Miners and Zen Miners, two Connecticut firms accused of running Ponzi schemes. The settlement required both companies to return $10,384,099 in disgorgement and prejudgment interest and to pay a $1,000,000 civil penalty. Both GAW Miners and ZenMiner shut down operations.
