CFTC Investigates Alleged Crypto Fraud Involving Memecoin BEN and Hit Network

TLDR:

• The CFTC is investigating potential crypto fraud involving 15 tokens, including memecoin BEN, linked to Hit Network.
• Ben Armstrong, once the face of Hit Network, is not directly named in the subpoena but has a controversial past with the tokens.
• Armstrong’s alleged substance abuse and controversial promotion of BEN led to his departure from Hit Network in August 2023.

The CFTC is looking into 15 tokens, including the popular memecoin BEN, to uncover any possible fraud. The investigation's main focus is on unknown individuals.

As a result, on July 16, the CFTC sent Hit Network, a media organization that focuses on cryptocurrency, a subpoena.

Information regarding trading behavior and digital wallets connected to these coins is sought by the subpoena. This action is a component of an investigation into illegal activity connected to digital currency fraud.

Ben Armstrong's Role and Past Controversies

Ben Armstrong, known as "BitBoy," previously served as the public face of Hit Network. However, the subpoena does not directly reference Armstrong. He had featured all the tokens mentioned in various videos.

For example, one video claimed that a token had the potential to rise 100 times in price. These videos, except for those mentioning BEN, were made before March 2021 under the BitBoy Crypto branding.

Hit Network formed in March 2021, with Armstrong as the host of its flagship show. Armstrong's tenure with the company ended in August 2023.

CEO T.J. Shedd removed him over allegations of substance abuse. Armstrong later admitted to taking diet pills and steroids but denied using hard drugs.

After his departure, Armstrong was arrested for attempting to reclaim a disputed Lamborghini from a former business partner's house. He is currently litigating against Hit Network over his exit and the vehicle.

Allegations and Accusations

In a statement, Armstrong accused his former colleagues of financial control over the BitBoy Crypto brand since 2020. He made similar accusations online. He expressed happiness about the subpoena.

"All I have asked for over a year is for people to listen to me," Armstrong told The Block. "Everyone in this industry almost turned on me. Now, many of those people will begin to feel the weight of their betrayals."

Armstrong regularly hosted YouTube videos recommending tokens, claiming they would make his audience rich. However, many of these tokens saw price declines.

He admitted to doing paid promotions of crypto scams, claiming it was accidental. Armstrong once paid blockchain sleuth ZackXBT $10,000 for showing he had done undisclosed promotions.

The memecoin BEN, created by ben.eth on May 5, 2023, is listed in the subpoena. Armstrong joined the token’s core team shortly after its creation. He parted ways with the project on June 5 but later became its CEO.

According to a source close to Hit Network, Armstrong’s involvement with BEN contributed to his exit. Other company members opposed the token's inclusion in their business.