Bitcoin Rodney cops to $1.8B HyperFund plea — daily 1% yields really were too good to be true 🤷

A Florida man who built a public persona as "Bitcoin Rodney" pleaded guilty this week in federal court in Baltimore to conspiring to operate an unlicensed money-transmitting business tied to a $1.8 billion cryptocurrency fraud scheme, according to the U.S. Attorney's Office for the District of Maryland. Rodney Burton, 56, of Miami and Prince George's County, Maryland, admitted to promoting HyperFund, a platform prosecutors describe as a sweeping global wire-fraud operation. U.S. Attorney Kelly O. Hayes announced the plea Wednesday alongside agents from IRS Criminal Investigation in Washington and Homeland Security Investigations in New York.

According to court documents, Burton conspired between June 2020 and January 2022 to provide unlicensed money-transmitting services that funneled investor funds through HyperFund. The platform marketed "memberships" promising daily passive returns of 0.5% to 1% until an investor's initial stake doubled or tripled, claiming payouts were funded by revenue from large crypto-mining operations that prosecutors say never existed. By 2021, HyperFund had begun freezing investor withdrawals altogether, and the scheme collapsed in November 2022 after multiple rebrands that began with HyperCapital's January 2022 launch as a DeFi ecosystem.

Prosecutors said Burton controlled a network of companies that claimed to offer consulting services but functioned as unlicensed money transmitters, personally pocketing more than $7.8 million from the operation, with some proceeds drawn from Maryland-based victims. He faces up to five years in prison on the conspiracy charge. Sentencing before U.S. District Judge Richard D. Bennett is set for July 23, with Assistant U.S. Attorney Christina A. Hoffman prosecuting the case.

HyperFund is one of the largest crypto fraud schemes on record and has been compared to Ponzi-style collapses such as OneCoin, which drew over $4 billion, and BitConnect, which is estimated to have caused more than $2 billion in investor losses. In January 2024, federal prosecutors in Maryland charged two other individuals in connection with the scheme: Australian Sam Lee, 35, alleged co-founder of HyperFund, and Maryland resident Brenda Chunga, who faced conspiracy charges alongside securities and wire fraud counts. Chunga's sentencing, previously delayed multiple times, is now scheduled for June 29; Lee has not been convicted of any offense.

Burton had cultivated a high-profile image in crypto circles, hosting a 2021 Miami conference that featured appearances from "Shark Tank" investor Draymond Green, "Wolf of Wall Street" author Jordan Belfort, singer Akon and comedian Tiffany Haddish, and relying on celebrity ties to actor Jamie Foxx and rapper Rick Ross to amplify his reach, according to a Rolling Stone report. Separately, a bipartisan pair of senators is moving to put Congress on record against any clemency for Sam Bankman-Fried, with Sens. Rubén Gallego (D-AZ) and Cynthia Lummis (R-WY) introducing a resolution declaring that the convicted FTX founder should not receive a pardon, commutation or other federal clemency.