Crypto Fund Founder Japheth Dillman Convicted of Selling Non-Functional Trading Software

A federal jury in San Francisco has convicted Japheth Dillman, the 48-year-old founder of Block Bits Capital, of crypto fund fraud.

Dillman was accused of selling investors on a trading software called Autotrader, which he claimed generated returns through automated cryptocurrency trading. However, prosecutors demonstrated that the algorithm did not work as represented and that Dillman knew it.

Between June 2017 and August 2018, Dillman raised nearly $1 million from over 20 investors for Block Bits Capital. The funds were misused for personal payments and speculative cryptocurrency bets that resulted in heavy losses.

Dillman faces up to 20 years in prison and a $250,000 fine per count, with sentencing set for December 8.