MyTrade Founder Sentenced for Crypto Market Manipulation

Liu Zhou, the founder of crypto firm MyTrade, has been sentenced to prison for his role in a wide-ranging conspiracy to manipulate cryptocurrency markets on behalf of client companies. In October 2024, Mr. Zhou was charged along with 17 co-conspirators and pleaded guilty to conspiracy to commit market manipulation and wire fraud.

MyTrade provided financial services to cryptocurrency clients through its 'MyTrade MM' website and online application, including the wash trading of client cryptocurrencies across multiple exchanges. Wash trading occurs when a single trader or several traders working in coordination buy and sell the same asset repeatedly to mislead the market by artificially inflating the trading volume or price.

Mr. Zhou's company used computer programs known as 'bots' to generate the fraudulent wash trades for clients, which were executed through the 'Volume Support' service available on MyTrade MM's website. The service allowed clients to specify the desired amount of daily wash trades and was identified through an undercover law enforcement operation.

As part of his plea in October 2024, Mr. Zhou's company was required to cease providing 'Volume Support' services and permanently deactivate its wash trading bots, which had been responsible for millions of dollars' worth of daily wash trades for approximately 60 different cryptocurrencies.