DOJ Charges Frosties NFT Creators With Fraud

Key Takeaways

  • The U.S. Division of Justice has charged the creators of the Frosties NFT collection with fraud and cash laundering.
  • Ethan Nguyen and Andre Llacuna allegedly stole over $1 million by finishing up a rug pull whereas promoting their NFTs.
  • Although the creators didn’t ship on the venture’s guarantees, Frosties NFTs stay in circulation amongst traders.

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The U.S. Division of Justice (DOJ) has charged two people concerned within the Frosties NFT venture with fraud.

Frosties Creators Carried Out Rug Pull

Frosties creators Ethan Nguyen and Andre Llacuna reportedly defrauded traders of $1.1 million by way of their scheme.

The DOJ says that the 2 people carried out a “rug pull” whereas promoting their NFTs. The creators offered tokens that includes ice cream-themed collectible characters with varied attributes. Traders would have been capable of earn cryptocurrency by way of staking and breeding. They might have gained entry to a broader metaverse recreation.

Nevertheless, the 2 creators didn’t did ship the advantages and rewards that they initially marketed. After the Frosties NFTs offered out, the creators deactivated the venture’s web site and despatched the cash they earned to their very own cryptocurrency wallets.

Nguyen and Llacuna labored beneath varied aliases together with “Frostie,” “Jakefiftyeight,” “Jobo,” “Joboethan,” “Meltfrost,” and “heyandre.”

Every has been charged with one rely of wire fraud, carrying a most sentence of 20 years in jail, and one rely of conspiracy to commit cash laundering, which carries a most sentence of 20 years.

Frosties Tokens Proceed to Flow into

Although the DOJ didn’t make an announcement till immediately, the Frosties rug pull occurred months in the past on Jan. 9.

Though that occasion prevented traders from reaping the promised advantages, Frosties NFTs stay in circulation. OpenSea studies that 69.4 ETH ($216,000) of NFTs have been traded to this point.

Additionally in circulation can also be a community-made collection known as Wrapped Frosties, which goals to satisfy a few of the venture’s authentic targets. That collection has circulated 2.6 ETH ($8,000) to this point.

The unique creators additionally deliberate to launch a second NFT line known as Embers, which was anticipated to earn $1.5 million. It seems that this collection continues to be energetic beneath a distinct crew.

Disclosure: On the time of writing, the creator of this piece owned BTC, ETH, and different cryptocurrencies.

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