380 investors face Bitcoin mining losses after alleged $22M US scheme put just 13% into mining

Here is the latest from the digital-asset markets: A US-based crypto mining venture raised about $22 million from more than 380 investors, then spent just 13 cents of every dollar on its purported mining operation, the SEC alleges. The regulator filed partially settled charges on July 20 against Zan Shaikh and Bright Vision Distribution LLC, doing business as Mining Automatic. According to the SEC complaint, the defendants promised guaranteed monthly returns between approximately June 2023 and May 2025 even though the purported mining operation was not set up to generate those levels of returns.

The SEC alleges Shaikh and Mining Automatic took in at least $20 million more than they repaid to investors. It said investor money was used largely for marketing to solicit new investors, along with Shaikh’s personal expenses and unrelated business expenses. Shaikh and Mining Automatic agreed to proposed permanent injunctions, subject to court approval.

Market Dynamics

Shaikh also agreed to an officer-and-director bar and a conduct-based injunction. If the court approves the consent judgments, disgorgement, prejudgment interest, and civil penalties would be decided later on an SEC motion. Any investor distribution or recovery remains unannounced and uncertain.

Related Reading Mining Capital Coin CEO charged with $62M crypto fraud Mining Capital Coin CEO Luiz Capuci Jr. faces multiple charges and may be sentenced to up to 45 years in prison if convicted on all counts. May 10, 2022 Jinia Shawdagor FBI outreach could widen the known pool A separate FBI victim-information page says the bureau’s Boston Division is seeking potential victims connected to Shaikh, Bright Vision Distribution, YT Automatic and Mining Automatic.

The questionnaire also names RankOne Ecommerce and Replic8 among companies affiliated with Shaikh and associates, without defining each relationship, and says investors were primarily targeted from 2022 through 2025. The FBI’s outreach casts a wider net than the SEC’s case, which covers more than 380 investors allegedly promised guaranteed returns from around June 2023 to May 2025. More victims may now come forward, but the FBI has not updated the total or suggested anyone will get their money back.

Market Impact

Related Reading SEC filings reveal the multi-million dollar trap hiding inside ‘exclusive’ WhatsApp crypto investment clubs The SEC's complaint maps the playbook of group chat "signals," phony STOs, and a withdrawal-fee twist, plus how to verify licenses in minutes. Dec 30, 2025 Gino Matos The FBI says submissions are voluntary, may aid the investigation and may lead agents to request more information. It says victims may be eligible for services, restitution and rights under federal or state law.

Submitting the form remains an information-gathering step, with formal claim status left unspecified. The next formal step is court review of the proposed judgments. If they are approved, the SEC can move for the court to set monetary relief, while the amount investors might ultimately recover remains unknown.

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