PANews reported on February 5th that the U.S. Securities and Exchange Commission (SEC) has filed market manipulation charges against three cryptocurrency companies, ZM Quant, Gotbit, and CLS Global, accusing them of using algorithms to create fake trading (wash trading) and generate false trading volume to mislead retail investors. In addition, nine individuals have been charged with violating anti-fraud and registration provisions of securities laws for allegedly employing manipulation services and executing trades that have no economic significance.

The FBI's sting operation, which uncovered the companies' involvement in fraudulent transactions through the creation of the fake token NexFundAI, led to charges against 15 entities and the initiation of related criminal proceedings. SEC officials noted that these manipulations harmed retail investors through false promises and deceptive tactics.