CFTC Issues Order Against Fraudulent Crypto Arbitrage Company

The Commodity Futures Trading Commission (CFTC) has issued an order against the CEO of a fraudulent crypto trading firm known as "Arbitraging.co."

Jeremy Rounsville defrauded investors by claiming to have developed a "highly advanced arbitrage bot” that could offer automated arbitrage trading, according to a CFTC announcement.

"The claims were, however, untrue. Arbitraging.co’s bot, known as the 'aBOT,' never executed trades on behalf of investors," the CFTC said.

The U.S. derivatives markets regulator said Rounsville's "disturbing misrepresentations" demonstrate the importance of comprehensive regulation, in the form of robust customer protections and market integrity oversight.

"While Rounsville simply manufactured fabrications to solicit funds, investors may genuinely and increasingly be lured into such schemes because the technology supporting complex trading strategies is already readily accessible," CFTC Commissioner Kristin Johnson said.

"The uses of remarkably sophisticated trading technology in the digital asset ecosystem are, in fact, exceedingly competitive, particularly those strategies focused on capturing arbitrage gains or rents that, by definition, may be fleeting and elusive," she added.

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