Virgil Capital founder is guilty of $100M crypto fraud

Founder of Virgil Capital formulated a market-neutral strategy using client’s funds
  • The founder Stefan He Qin of the Virgil Capital has allegedly been found guilty of misusing the funds that the investors paid 
  • He formulated a market-neutral strategy for his clients but then failed to invest the funds in the formulated strategy and instead misused them for personal investments
  • The court of Manhattan sentenced him to 20 years of imprisonment as he pleaded guilty to his wrongdoings and promised to make amends 

Stefan He Qin, the founder of Virgil Capital, 24-year old, on February 4, 2021, Thursday accepted his crime. He pleaded guilty to dumping his investors out of an amount of almost $100 million by running a hedge of crypto funds from two different sources. He used up this fraudulent money to support a lavish sort of lifestyle for himself. He was brought before the federal court of New York, and he admitted his doings there. The court sentenced him to an imprisonment of 20 years. The prosecutor admitted that he had stolen his investors’ money from the funds of Virgil Sigma Funds LP. This very fund was controlled by him and used to run on an algorithm in which it used to hone on the instances when there appeared to be a considerable price difference in various cryptocurrencies. He then relied on the other portal that he ran to pay back his investors, the funds that they had invested in the first funds, and it was named VQR Multistrategy Fund LP. 

The outcome of the Virgil Capital founder’s fraudulent activity

In no time, the tables turned, and the Virgil Capital founder’s wrongdoings were revealed. He is now awaiting to start with his sentence for thievery. It was said in a statement by the United States attorney for Manhattan, in his statement. Although the entire scheme was skillfully prepared and carried out, such ill-motivated people can never survive in the long run and will be caught for their crimes. He took advantage of the money that all his investing clients paid to purchase a specific cryptocurrency portal. He used all that money to offer himself a well-established and luxurious life. Although he did think of returning the funds from his other fund’s source, such scams, once done, can never be undone. 

The strategy from Qin’s point of view

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As per Qin, the prosecutor, his strategy was meant to be neutral to the market. It meant that any assets invested in his funds were in no harm, and he also claimed that no matter how much the market of the cryptocurrencies fluctuate, no harm will come to the funds and his investors. But with time, Qin began to misuse the funds. He began to pay for his needs instead of spending on his formulated strategy. Qin kept making more and more personal investments until he was caught and pleaded guilty. However, he promised the court to return as much as he can, to his investors.

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Ahtesham Anis
Ahtesham Anis is a Computer Science undergrad student currently based out of India. Coming from the business background and his keen interest in Cryptocurrency and Blockchain technology is what Ahtesham brings to the table. He is always an eager learner when it comes to exploring the new technologies and topics in the crypto world.

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