**Cryptocurrency Firm Agrees to Plead Guilty in Market Manipulation Case**
**BOSTON, Jan 21 (Reuters)** – A cryptocurrency financial services firm has agreed to plead guilty to U.S. charges of market manipulation involving a digital token created by the FBI as part of an undercover operation aimed at uncovering fraud in the crypto industry.
CLS Global, a company registered in the United Arab Emirates, was among three firms and 15 individuals charged last year by federal prosecutors in Boston. This case stems from "Operation Token Mirrors," a groundbreaking investigation where the FBI developed its own digital token and a fake cryptocurrency company to expose fraudulent activities.
A lawyer for CLS Global did not respond to requests for comment. However, the company has previously stated its commitment to compliance and maintaining separation from U.S. markets and regulatory systems.
Prosecutors alleged that CLS Global acted as a market maker, offering illicit trading services to cryptocurrency companies. As part of the FBI sting, the company agreed to manipulate the market for NexFundAI, a token backed by the FBI and operating on the Ethereum blockchain.
Court documents revealed that CLS Global admitted to engaging in practices such as "wash trading," which involves executing fake transactions to artificially inflate a token’s trading volume or price.
On Tuesday, prosecutors announced that CLS Global would plead guilty to two charges related to the fraudulent manipulation of cryptocurrency trading. The company will pay $428,059 in penalties and face a ban from participating in cryptocurrency transactions on trading platforms accessible to U.S. investors. Additionally, CLS Global will be prohibited from providing services to U.S.-based cryptocurrency clients.
As part of the resolution, CLS Global has also agreed to annual certifications regarding its business practices and to settle related civil charges with the U.S. Securities and Exchange Commission (SEC).
'A mockery': Trump's new meme-coin sparks anger in crypto world
Former US President Donald Trump has come under fire for launching a meme coin despite admitting he "doesn't know much" about cryptocurrency. The digital token, dubbed TRUMP, debuted on his social media platforms ahead of his inauguration on Monday. Initially,
it skyrocketed in value, with a single coin reaching $75 within 24 hours, though it later dropped to $39.
The launch of TRUMP, a so-called meme coin—a cryptocurrency primarily intended for entertainment or speculation—has sparked widespread criticism from industry experts. Danny Scott, CEO of CoinCorner, commented,
"Trump's remarks about his lack of knowledge regarding the coin reinforce my belief that he’s trivializing the industry. This is just a publicity stunt."
The coin’s value experienced further dips after Trump stated during a press event,
"I don't know much about it other than I launched it and it was very successful." When informed that the coin had raised billions, he dismissed the figure, saying, "Several billion—that's peanuts for these guys," gesturing toward a group of tech billionaires gathered for an AI-related conference.
Meme coins are often created to allow fans to demonstrate
'A mockery': Trump's new meme-coin sparks anger in crypto world
their support for a public figure or to commemorate an internet phenomenon, but they are frequently criticized for their speculative nature. This isn’t Trump’s first foray into crypto. In 2022, he profited handsomely from a series of NFTs depicting him in superhero-themed poses.
Some industry insiders view TRUMP as a potential trendsetter
. Jeff Dorman, of the investment firm Arca, remarked, "The TRUMP token signals to every brand, company, municipality, and university that crypto can serve as a mechanism for capital formation and customer engagement."
Nevertheless, the overall reaction to the coin has been largely negative. Many in the crypto
community are waiting to see if Trump will fulfill his campaign promises to boost the U.S. cryptocurrency industry. Last year, he pledged to make the country the "crypto capital of the planet," but a few days into his presidency, no executive orders or policies concerning cryptocurrency have been announced.
Currently, TRUMP is ranked as the 25th most valuable cryptocurrency,
boasting a market value of approximately $8 billion, according to CoinMarketCap. However, Trump and his team reportedly own 80% of the tokens, raising concerns about market manipulation. David Zimmerman, an analyst at K33, criticized the coin’s structure, calling it "horrendous
for a meme coin." He did, however, acknowledge that with 80% of the coins locked away, the market is partially protected from significant price shocks.
In a parallel development, First Lady Melania Trump also launched her own meme coin on the eve of the inauguration. Although it initially reached a value of $13 per coin, it has since plummeted
to $2.70, leaving the total market value at around $700 million. Her cryptocurrency was promoted using a black-and-white portrait of herself, adding to the fanfare surrounding these launches.
Despite the hype, many experts caution against the trend of celebrity-driven cryptocurrency projects. Dan Hughes, from crypto firm Radix, expressed concern, saying, "This pattern of token launches by public figures could overshadow the industry’s genuine innovations,
reducing its credibility." Grzegorz Drozdz, a market analyst at Conotoxia, echoed these sentiments, adding, "Launching meme coins during a presidential inauguration raises ethical questions and risks diminishing the office's dignity."
As the debate over Trump’s cryptocurrency ventures continues, industry leaders and investors alike are calling for more substance and long-term vision to support the growth of the U.S. crypto sector.
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