Crypto Founder Escapes U.S. Fraud Charges, Tokens Surge

A U.S. district court judge has dismissed a fraud case brought by the Securities and Exchange Commission (SEC) against Richard Heart, the founder of Hex cryptocurrency. The ruling, made by Judge Carol Bagley Amon on February 28, was based on the lack of U.S. jurisdiction over Heart's alleged deceptive conduct.

The SEC had accused Heart of raising over $1 billion through unregistered cryptocurrency offerings and stealing $12.1 million to purchase luxuries, including the world's largest black diamond. However, Amon ruled that the transactions were conducted globally and were not specifically targeted at U.S. investors. She also noted that the alleged misappropriation occurred through crypto asset platforms and digital wallets with no connection to the United States.

Following the court ruling, Heart's related tokens saw significant price surges. HEX (HEX) increased by 78%, PulseChain (PLS) by 36%, and PulseX (PLSX) by 67%. Heart welcomed the ruling on X (formerly Twitter), stating that "HEX has run without a hitch for over five years" and terming the judgment as a "welcome relief" for the cryptocurrency industry.

Although the court has rejected the action, Amon stated that the SEC can re-state the complaint by addressing the deficient areas within 20 days, with March 20 being the deadline.

In the dismissed case, the SEC claimed that Heart used investor funds to make expensive purchases, including "The Enigma" black diamond, McLaren and Ferrari sports cars, and four Rolex watches worth $3.02 million.

Despite the dismissal of the SEC case, Heart continues to face legal troubles in Finland. He was arrested by Finnish authorities on September 13, 2024, on tax fraud and assault charges and remains missing, with Interpol issuing a Red Notice for his arrest on December 22. Finnish authorities have managed to seize $2.6 million worth of watches suspected to have been abandoned by Heart.

Heart remains active online, promoting his cryptocurrencies and engaging with fans via social media, openly tweeting on X and posting videos on YouTube. The crypto community is closely monitoring the situation as events develop, awaiting the SEC's next move.