SEC secures $5.5 million default judgment over alleged NanoBit crypto fraud

Traders Union
All News
Crypto
SEC secures $5.5M over NanoBit fraud

Highlights

On June 16, the U.S. District Court for the Eastern District of New York entered a $5,518,902 default judgment against NanoBit Limited, Radiant Horizons Limited, Sweet Karma Fashion Inc., Zhao Tropical Deli Inc., Jiajie Liu, and Hua Zhao for operating a crypto investment scam from September 2023 to June 2024.
At least 18 investors lost nearly $1 million in crypto and fiat currency, with NanoBit Limited ordered to pay $532,000 in disgorgement, $82,000 in prejudgment interest, and a $1.1 million civil penalty; all payments due within 30 days.
The court permanently barred all six defendants from federal securities activities, while highlighting the SEC's intensified enforcement focus on fraudulent relationship-investment crypto platforms like NanoBit and CoinW6.

Court order and enforcement action

According to CoinDesk, the U.S. District Court for the Eastern District of New York entered the default judgment on June 16 against NanoBit Limited, Radiant Horizons Limited, Sweet Karma Fashion Inc., Zhao Tropical Deli Inc., Jiajie Liu and Hua Zhao.

The regulator says the defendants ran a relationship-investment scam from September 2023 to June 2024, posing as financial professionals in WhatsApp groups and steering victims to deposit money into NanoBit. The SEC alleges the platform showed investors fake dashboards with apparently profitable trades, even though no actual crypto transactions were executed.

According to the SEC's complaint, at least 18 investors lost nearly $1 million in crypto and fiat currency. The court order includes $5,518,902 in combined disgorgement, prejudgment interest and civil penalties, and the judge found the default was willful after the defendants did not appear in court or present a meritorious defense.

Penalties and broader market impact

NanoBit Limited faces the largest financial sanctions, including more than $532,000 in disgorgement, nearly $82,000 in prejudgment interest and a $1.1 million civil penalty. The three other entity defendants each must pay $1.1 million in penalties, while Liu owes $120,000 and Zhao owes $55,000; all payments are due within 30 days.

The court also permanently bars all six defendants from violating federal anti-fraud provisions and from participating in securities offerings or transactions. Liu and Zhao are still allowed to trade through their personal accounts.

The SEC says NanoBit falsely claimed that an affiliate, NanobitUS Securities, was registered with the agency and connected to reputable financial firms. The regulator filed the original complaint in September 2024 alongside a parallel case involving another alleged fake platform, CoinW6, describing both matters as among its first enforcement actions targeting relationship-investment scams built around sham crypto platforms.

The U.S. Supreme Court ruling on presidents’ power to remove officials from independent regulatory agencies highlighted how Washington may see faster swings in regulatory priorities as agency independence narrows. Our earlier article noted that the decision could increase volatility in how key watchdogs operate, while still treating the Federal Reserve as a special case with stronger historical protections.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.