The sum amounts to more than 12 million euros: a man sentenced to prison in Paris for having created then stolen a billion digital tokens from a crypto platform

This is a rare conviction in this type of case: a man accused of having fraudulently created and then stolen a billion digital tokens from a cryptocurrency platform based in the Cayman Islands was sentenced Friday by the courts to five years in prison, including two years. The Paris Criminal Court held against him the charges of "attack on an automated data processing system", "organized gang fraud", "money laundering" and "criminal conspiracy", according to its deliberations delivered on Friday. He received “five years of imprisonment”, accompanied by “a probationary sentence of 36 months”, or three years.

His two accomplices, tried at the same time as him, were sentenced respectively to an 80,000 euro fine and two years in prison, including 14 months suspended, and to a 40,000 euro fine and two years suspended sentence.

The main defendant, a Ukrainian living in France, was incarcerated in September 2024, after his arrest in Italy and his handover to the French authorities. The two other defendants, tried for money laundering and complicity, appeared free. One billion tokens The events took place between May and August 2024, while the defendants were located in Paris and Roquebrune-Cap-Martin (Alpes-Maritimes).

The main defendant “fraudulently generated one billion HLG digital tokens”, a cryptocurrency marketed by the company Holograph Foundation. The sum generated was equivalent at the time to “14 million dollars” (12.5 million euros), according to the prosecution. To achieve this, this former employee of the company “modified the conditions of creation” of digital tokens on the platform.

Once the tokens were created, he transferred these cryptocurrencies to a digital wallet belonging to him. With his two accomplices, he then distributed these funds among “several accounts” on cryptocurrency exchange platforms. However, the court did not consider that the collapse in the value of the cryptocurrency which took place after the events should be attributed to fraud, contrary to what the company Holograph Foundation claimed, which requested compensation in this regard.

The Holograph Foundation's lawyer lamented at the hearing that the company was now "completely at a standstill" because of this affair and that it was preparing its liquidation. A token was worth nearly $0.03 in May 2024, the amount was only $0.001 at the end of December, according to the financial platform Finary. A request refused by the court.

Its president estimated that "the price had already varied significantly downwards before the facts and therefore there is no acceptable basis to be able to estimate a loss of value directly linked" to the fraud. “Fantasy” Robin Binsard, one of the lawyers for the main defendant, welcomed the fact that the court had dismissed this “fantasy”, demonstrating that “the Holograph company had no credibility”. The defense more generally welcomed "a satisfactory decision, with a sentence well below the requirements of the public prosecutor, which will allow" the accused "to regain freedom in the coming months".

Machine-translated from French