Entrepreneur who sought to merge celebrities, social media and crypto faces fraud charges
A California entrepreneur sought to merge the bitcoin culture with celebrities.
NEW YORK — A California entrepreneur who sought to merge the bitcoin culture with social media by letting people bet on the future reputation of celebrities and influencers has been arrested on a fraud charge.
Nader Al-Naji, 32, was arrested in Los Angeles on Saturday on a wire fraud charge filed against him in New York, and civil claims were brought against him by federal regulatory authorities on Tuesday.
He appeared in federal court on Monday in Los Angeles and was released on bail.
Authorities said Al-Naji lied to investors who poured hundreds of millions of dollars into his BitClout venture. They say he promised the money would only be spent on the business but instead steered millions of dollars to himself, his family and some of his company’s workers.
A lawyer for Al-Naji did not respond to an email seeking comment.
The Securities and Exchange Commission said in a civil complaint filed in Manhattan federal court that Al-Naji began designing BitClout in 2019 as a social media platform with an interface that promised to be a “new type of social network that mixes speculation and social media.”
The BitClout platform invited investors to monetize their social media profile and to invest in the profiles of others through “Creator Coins” whose value was “tied to the reputation of an individual” or their “standing in society,” the commission said.
It said each platform user was able to generate a coin by creating a profile while BitClout preloaded profiles for the “top 15,000 influencers from Twitter” onto the platform and had coins “minted” or created for them.
If any of the designated influencers joined the platform and claimed their
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