B.C.-based crypto platform committed $13M fraud: securities commission

A B.C.-based crypto trading platform lied to its customers while "diverting" $13 million-worth of their assets to gambling, according the provincial regulator.

A B.C.-based crypto trading platform lied to its customers while "diverting" $13 million-worth of their assets to gambling, according the provincial regulator.

A panel of the B.C. Securities Commission found that the now-defunct platform, eZbtc and its director, David Smillie committed fraud between 2016 and 2019.

"Customers were unable to recover all of their assets. The deceit led to actual loss,” the BCSC's decision said.

The platform told investors that their crypto assets would be held in "cold storage," which the BSCS explains is "a more secure method of keeping digital assets offline to protect them from cyber threats and unauthorized access."

The panel's decision quotes several instances in which Smillie told customers their assets would be held in cold storage.

“I’ve taken extra precaution to segregate and cold store your coin,” he said in one instance.

“One of my biggest things has always been cold storage, cold storage, cold storage,” he said in another.