Back in 2022, Arshad Assofi et al v. Donald Basile e al was filed in the U.S. District Court in California. After an arbitrator issued a $42.5 million damages award in 2025, GIBF filed a new appealing lawsuit in Delaware: GIBF GP, Inc. v. Arshad Assofi, where Judge Maryellen Noreika has just confirmed the California decision to issue the award.
The lawsuit was first filed by investor Arshad Assofi against the founder of Bitcoin Latinum token (LTNM) Donald Basile and GIBF GP, Inc., alleging this operation was a worthless scam. Assofi argued that Basile convinced him to invest based on false information about the other backers, such as receiving $20 million from the producers of Star Trek (denied by Paramount). Basile had suggested this association by naming this currency after “latinum, a fictional currency employed by the Ferengi in Star Trek. Basile had also falsely claimed that the coin was backed by an asset trust and insured for up to $1 billion.
Assofi had invested $15 million by purchasing simple agreements for future tokens (SAFTs). But Basile had misappropriated these funds on personal real estate and luxury items such as a $160,000 horse. When he realized Basile was not building this coin and that it would remain worthless, he asked for a refund that Basile refused, leading to this battle.
SEC also filed a civil fraud lawsuit against Basile, GIBF GP, Inc. and Monsoon Blockchain Corporation on April 17, 2026 in New York. SEC’s case mirrors Assofi’s filings, while aiming to apply new penalties, including banning Basile from serving as an officer of a public company.
Bitcoin Latinum saw a peak token price of around $190 during the 2021 crypto boom, but has dropped to around $.41. KuCoin shows an all-time high as $9,322, but this was a brief glitch at which the public would not have been able to trade this coin. The coin’s website is defunct, but the business has not yet officially filed for bankruptcy protection.
While the case names hundreds of defrauded investors, it seems there was only $16 million invested, with most being from Assofi. Other investors have filed in Michigan against a promoter who had convinced them to purchase Latinum.
The most recent appeal filing claimed the arbitration award was manipulated “by corruption, fraud, or undue means” with “evident partiality or corruption in the arbitrators”, specifically Daniel B. Garrie, Esq., who were “guilty of misconduct in refusing to postpone the hearing” and by “refusing to hear evidence pertinent… to the controversy”.
From Basile’s perspective, he claimed Assofi’s purchase of the tokens was made with no binding investment relationship. Basile argued that the sudden 95% drop in the token’s price coincided by the crypto market’s crash, as opposed to any deception on his part. Basile initially attempted to threaten a $1 billion countersuit that accused Assofi of filing fabricated fraud charges in an extortion scheme. Basile has not yet surrendered any money or assets in response to the arbitration decision. And if SEC wins their case before Basile pays Assofi, SEC might empty Basile’s coffers before Assofi digs in.
There have been several similar lawsuits over crypto currency owners defrauding investors: the crypto owners have lost most of these. FTX’s Sam Bankman-Fried diverted $8 billion in customer deposits and is now serving a 25-year federal prison sentence with a looming $11 billion forfeiture order. Terraform Labs’ Do Kwon was found guilty of operating a $40 billion fraud, now serving a 15-year prison sentence, and owns $19 million in forfeiture. The one escape-hatch has been Changpeng Zhao securing a pardon from Trump and negotiating a settlement with the Department of Justice by paying a $4.3 billion penalty for Binance.
Is the difference then between crypto fraud and legality in if it is operated or protected by the president? If not being too cynical, there are provable frauds in these convicted crypto entities, as in the Latinum case: false claims of insurance protection and backers, and a lack of a finance platform on a recognized public blockchain. As long as World Liberty Financial (WLF) is disclosing that it is paying out millions in tokens to the Trump family, it is not defrauding other buyers. Though WLF has recently been civilly sued over constitutional and corporate violations, such as corruptly accepting billions from foreign governments (especially UAE).
All but the top major multi-billion crypto businesses have been sued by U.S. regulators (SEC, CFTC, DOJ) over fraud or unregistered security offerings. Largely because of Trump’s personal profiteering from crypto, he has put leadership in place at SEC that has lowered its crypto laws by 60%. The biggest still operating crypto companies, such as Binance and Crypto.com have only been hit with regulatory lawsuits, as opposed to criminal fraud charges. The reason the top crypto company in the world, Bitcoin ($1.62 trillion), has not been sued by a U.S. regulator is because it is a decentralized, open-source software protocol without any corporate founder who might have been accused of fraud. Though it is very suspicious that the second largest business, Ethereum ($286 billion), has never been sued despite it having a founder, Vitalik Buterin. It is logical to assume that the companies at the top have been knocking out their competition by encouraging federal prosecutions against their competitors over fraud charges. Otherwise, there would not be exceptions of top companies that are committing the same securities violations, but are skipped over. For example, the third largest company, Tether ($182 billion), has faced multiple lawsuits, such as about its corporate statements that each 1 USDT token was backed 1:1 with cash, when it was merely backed by unsecured commercial debt and commingled corporate funds. It is improbable that Ethereum or Bitcoin have billions or trillions in cash in their vaults, and yet they have not faced the same scrutiny.
The winners in the crypto game seem to be hackers who can create the illusion of their non-involvement and thus prevent being vulnerable to personal fraud charges. The biggest fraudsters are those who can escape liability even beyond the protections offered to corporations.
And why are coin founders being accused of pocketing millions from investors for “personal gain” when all American corporate CEOs are pocketing millions in salaries and bonuses? Is the distinction that the crypto businesses are collapsing too soon after this pocketing? The lack of profitability is normal, as around 13% of biotech and AI startup companies in the Nasdaq have no revenue, and half are unprofitable. Investors who bet on unprofitable ventures are being defrauded through false advertising that promises they are going to become ultra-profitable in the future. There must be many exaggerations in unprofitable companies’ marketing that have cast this false confidence over the public. The point of fraud cases against crypto founders seems to have been to discourage small startups in this sphere for the giants to monopolize it. Crypto as a concept is a fraud: it is a fictional currency that can be manipulated by hackers who pretend a system is functioning because it is being fairly “mined”. Then again, state-issued currencies that are not backed by gold are also frauds: because there is no 1:1 backing for trillions in fictional bucks being printed. In an ideal world, nobody could speculate on currency, as there would be some international monetary unit that does not change in value and has no “creator”. People would just trade goods and services at standard exchange rates, without needing to worry about their local currency being devalued. But with trillions to be made on intervening in this utopia as middleman pocketing a share of all transactions, we are going to continue to see litigation until this sector is a monopoly.
