Bitcoin Ponzi Boss Sentenced to 20 Years, Justice for 90K Investors

In Brief

• A Bitcoin Ponzi scheme operator received a 20-year sentence.
• Over 90,000 investors lost millions.
• The case underscores persistent crypto fraud risks.

The CEO of Praetorian Group International (PGI) was sentenced to 20 years in prison for running a $200 million Bitcoin (BTC) Ponzi scheme that defrauded over 90K investors worldwide. Authorities say victims lost at least $62.7 million as funds went to luxury cars, real estate, and personal expenses. The case marks one of the larger Bitcoin-related MLM fraud convictions in recent years.

The Scheme: Promised 0.5%-3% Daily Returns

According to a February 12 press release by the United States Attorney’s Office, Eastern District of Virginia, Ramil Ventura Palafox, 61, operated PGI between December 2019 and October 2021, claiming the company generated profits through large-scale Bitcoin trading. Prosecutors say that wasn’t true.

Instead, investor funds were recycled to pay earlier participants, the company lacked trading volume to sustain promised returns, and online dashboards falsely showed consistent profits.

PGI raised more than $201 million during the scheme, including $30.3 million in fiat currency and 8,198 BTC (valued at $171.5 million at the time). Losses totaled at least $62.7 million, according to court filings.

Where the Money Went

Authorities detailed extensive personal spending tied to investor funds.

These included around $3 million spent on 20 luxury vehicles (Porsche, Lamborghini, Ferrari, Bentley, and others), about $6 million on four homes in Las Vegas and Los Angeles, approximately $329,000 on penthouse hotel suites, around $3 million on luxury goods like watches, jewelry, and designer clothing, and $800K in cash plus 100 BTC transferred to a family member.

The FBI and IRS Criminal Investigation handled the case.

Why This Matters for Crypto Investors

The PGI case highlights several recurring red flags in cryptocurrency-related fraud, including guaranteed daily returns, multi-level marketing structures, opaque trading strategies, and dashboard ‘profits’ that can’t be independently verified.

Despite market maturation and regulatory enforcement, high-yield Bitcoin investment schemes continue targeting retail investors globally.

What Happens Next?

Victims may be eligible for restitution, though recovery in large-scale Ponzi cases often remains partial. The sentencing reinforces the Department of Justice (DOJ)’s focus on crypto-based fraud, particularly schemes that combine Bitcoin branding with MLM-style recruitment.