Bitcoin fund manager and trader Jeremy Spence is facing a class action lawsuit, after it emerged that he allegedly mishandled ICO funds and operated a Ponzi scheme, culminating in a multi-million-dollar liquidation last month. Spence, who frequently posted Bitcoin charts on social media under the handle Coin Signals, appeared on the surface to be a successful trader, but it seems he may have turned to defrauding investors when things didn’t go his way. Mystery still surrounds the exact nature of his activities, but Bitstarz was able to contact an early investor under the condition of anonymity to get their version of what occurred.
Trading Fund
I came across Spence in 2018 when his Mex trading fund was promoted in a Discord group. By this time he had hired a programmer to build software that would allow users to invest, check their balance and withdraw funds as necessary, and it all looked legit. After many months of apparently successful trading, withdrawals began to take longer than stated and requests for information were met with silence. We began putting two and two together and worked out that he had lost a large amount of the funds, which he finally admitted to long after we had all realized what had happened.
When @coin_signals continues to be a lying SOB regarding his scam fund. RETWEET PLEASE #coinsignalsscam pic.twitter.com/B21nOIkdiu
— Ringo Kid (@ringokidcrypto) December 20, 2018
Every investor I know is still waiting for their payout after months of lies, delays, and locked funds, and Spence himself disappearing for a month after Bitcoin fell from $6,500 to $3,200. This seems to be when he lost most of his money, given that he himself said he was managing 1,500 BTC at the time. It wouldn’t surprise me if he was using newer investors’ money to pay off the more vocal critics earlier than this. I doubt we’ll ever see this money again, despite his promises to trade it back.
ICOs
Spence also ran a number of ICO pools. One such pool was for the Nexo token, which a select group of us didn’t receive after the ICO finished. Pence blamed this on an ‘enforced lockup’ by Nexo but Nexo persistently denied this, stating that all other ICO investors had received their tokens. We suspected Spence had sold them on an exchange at a profit and waited for the value to fall again so he could buy them back, but it didn’t fall for a long while. He later admitted that a portion of the coins had been “held up on an exchange” without saying how or when they got there. The investors eventually received their tokens, but the delays meant we lost out on any profits and the accusations left many concerned about his Mex fund.
Another ICO Spence was involved in was for EverMarkets. The ICO was delayed in June, and when we asked about our funds being returned to us we discovered that the entire pool had been refunded to Spence in August and he hadn’t told any of us, just taken our money and, presumably, traded it or paid investors off with it. This wasn’t revealed until two weeks ago while we were investigating the Mex fund issues, but for me it was the nail in the coffin. He’s cost me thousands of dollars, and I very much doubt I’ll get any of it back, even through legal means.
Will the Truth Come Out?
We might not know the full story of what Spence really did with the variety of funds at his disposal unless anything is made public as part of any further legal proceedings. What is certain is that there was, at best, a huge breach of trust and at worst, theft and a ponzi scheme. Whatever the outcome, it remains another in the long line of cautionary tales that serve to advise anyone wishing to invest in cryptocurrency, be it through individuals, funds or projects, that they are doing so at a huge risk and should only do so with money they can genuinely afford to lose.
