SEC Secures $5.52M Judgment Against NanoBit in Major Crypto Fraud Case

The U.S. Securities and Exchange Commission has brought a significant crypto fraud case to a close, securing a decisive legal victory against NanoBit and its associated entities. The case centered on an elaborate 'pig butchering' scheme that ran from September 2023 through June 2024, defrauding unsuspecting investors through a web of deception and false promises.

According to SEC allegations, the perpetrators leveraged popular messaging platforms — most notably WhatsApp — to establish trust with potential victims before steering them toward fraudulent investments. To maintain the illusion of legitimacy, NanoBit promoted fictitious cryptocurrency initial coin offerings that guaranteed unrealistically high returns. The operation went even further by falsely representing that its affiliated entity, NanobitUS Securities, held official SEC broker registration — a claim that was entirely fabricated.

The SEC publicly announced its courtroom win on June 29, approximately two weeks after the U.S. District Court for the Eastern District of New York handed down a final judgment. The ruling targeted two individuals — Jiajie Liu and Hua Zhao — along with four organizations: NanoBit, Radiant Horizons Limited, Sweet Karma Fashion Inc., and Zhao Tropical Deli Inc. All parties had failed to respond to the SEC's legal action, leading to a default judgment.

U.S. District Judge Sanket J. Bulsara made the scope of the fraud starkly clear in his ruling, noting that no actual transactions ever occurred on the NanoBit platform. Instead, investor funds were redirected to scheme participants, with over $2 million wired to bank accounts in Hong Kong. Additionally, hundreds of thousands of dollars' worth of investors' crypto assets were misappropriated.

The court's final order imposed a permanent injunction barring all defendants from violating key anti-fraud provisions under U.S. securities law. On the financial penalty side, the combined total reached nearly $5.52 million, covering three distinct components: disgorgement of illegally obtained profits, pre-judgment interest reflecting the period during which those gains were held, and civil penalties designed to punish wrongdoing and discourage similar conduct in the future.

NanoBit bore the heaviest financial burden, facing approximately $1.8 million in penalties. The remaining defendants — Radiant Horizons Limited, Sweet Karma Fashion Inc., and Zhao Tropical Deli Inc. — were each ordered to pay in excess of $1.18 million.

Judge Bulsara underscored the deliberate nature of the defendants' non-compliance, stating that their default was willful and that no legitimate defense had been brought before the court. He further noted that failing to enter a default judgment would result in unfair prejudice to the SEC, leaving the regulator without recourse to the relief it rightfully sought.

This case serves as a stark reminder of the growing threat posed by crypto-related fraud schemes that exploit social engineering tactics and false regulatory credentials to manipulate ordinary investors.