In 2024, the US Department of Justice and the FBI launched an undercover operation called "Operation Token Mirrors". The FBI essentially created an ERC-20 token on Ethereum called $NexF (NexFundAI) to attract companies offering illegal crypto market manipulation services.
This FBI token had:
- Website.
- Whitepaper.
- AI/investing narrative (AI-based passive income).
- Liquidity on decentralized AMM (Uniswap).
- Social media pages.
Undercover agents contacted crypto market makers and promoters, specifically asking for:
- Artificial volume increases.
- Wash trading.
- Coordinated pumps.
- Price manipulation.
Many entities performing this "work" agreed, and several conversations were recorded. The companies involved were Gotbit, CLS Global, MyTrade, and ZM Quant. The main charges were: wash trading, market manipulation, wire fraud, and pump-and-dump schemes. Gotbit is a company run by a 26-year-old Russian who publicly bragged in 2019 about building a business by falsifying trading volumes. His team maintained internal spreadsheets with columns literally labeled "fake volume" versus "market volume". When asked how quickly they could increase NexFundAI's trading volume to $1 million a day, they replied, "6 hours...so it'll cost about $200". MyTrade, on the other hand, was run by a man who explained the exact psychology of the scam: "We make the chart look like a nice roller coaster ride...That's where people jump in... We have to make them lose money so we can make money". He said this in a recorded FBI video call. CLS Global, on the other hand, is a Dubai-based entity where their bots generated 98% of NexFundAI's total trading volume. When the FBI asked if they could synchronize fake volume spikes with fake news announcements, they replied, "Absolutely". ZM Quant provided bots that executed 10 to 20 trades per minute across dozens of wallets to appear organic. Everyone knew it was a scam, but apparently they didn't care because money is money. The investigation claims that some platforms generated almost all of their volume (97%) through internally controlled bots. The IRS and blockchain investigators showed wallets exchanging tokens with each other, automated trading, and inorganic activity.
OTHER RUG TOKENS IMPLICATED
The Saitama token was cited in federal indictments. Prosecutors alleged that insiders and promoters coordinated manipulations and dumps to the detriment of retail investors on Telegram groups. These were then dumped on retail investors. The token was built entirely on fake volumes; every cent of real money came from retail investors who thought the momentum was organic. Gotbit was also used in this case. However, the founder of Lillian Finance claimed that a portion of the fees the token generated would be used to fund children's hospitals, but in reality, he pocketed everything. When the FBI shut it down, $25 million was seized in one day. US authorities identified 18 individuals and entities, making international arrests, extraditions from Portugal and the UK, seizing over $25 million, and shutting down trading bots. Gotbit founder Aleksei Andriunin was arrested in Portugal. According to the documents, operators were already offering these services, openly discussing fake volume, having automated infrastructure in place, and in some cases advertising manipulation as a commercial service.
Real people bought NexFundAI (the FBI's fake token) created solely to catch criminals. They attracted real retail investors because the fake volume made the chart appear bullish. After the FBI rug-pulled the operation to shut it down, they had to create a refund portal to repay retail investors. Within 24 hours of the Department of Justice announcing the operation, someone launched a clone token, earning nearly $130,000 in a single day. The Lexobit token was also reportedly an FBI sting operation that led to 10 more arrests.
Are you interested in ways to earn crypto bonus? Check it out here: Some Sites To Earn Crypto Bonus (Old & New)
