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FollowingCryptocurrency trading fund founder Jasheth Dillman was found guilty of fraud
Jasheth Dillman, founder of cryptocurrency trading fund Block Bits Capital, was recently found guilty of wire fraud and conspiracy by a San Francisco federal jury. Authorities said Dillman misled investors about the fund's automated trading techniques and raised nearly $1 million from more than 20 people between June 2017 and August 2018.
Misrepresentation and Fund Abuse
48-year-old Dillman assured investors that Block Bits's proprietary software,"Automated Trader," is fully functional and can generate returns through automated cryptocurrency transactions. However, prosecutors pointed out that the trading algorithm did not work properly and that Dillman knew about its flaws. Prosecutors alleged that Dillman and an unnamed co-conspirator used investor funds to pay themselves and made speculative investments in other crypto entities. These high-risk operations resulted in significant losses, which was completely contrary to Dillman's claim to investors that "Block Bits achieved strong profits."
Dillman told investors that their funds were managed by advanced trading software, but in fact the technology did not work and the funds were diverted for personal gain and subsequent failed high-risk investments. Despite accumulating losses, Dillman continued to lie to investors that the fund was performing well. These contradictions were eventually exposed in a federal investigation led by the FBI and IRS criminal investigation divisions and assisted by the Securities and Exchange Commission's San Francisco office.
The 10-day trial was presided over by U.S. District Judge Richard Seeborg. Dillman was convicted on all charges and was scheduled to be sentenced on December 8. He is currently still out on bail, pending court appearance. Each count carries a maximum penalty of 20 years in prison and a $250,000 fine, and the final penalty will be determined in accordance with federal sentencing guidelines. Founded in San Francisco, Block Bits Capital has positioned itself as an automated cryptocurrency investment company committed to providing customers with strong technology-driven benefits.
Small Dictionary
Block Bits Capital is a cryptocurrency trading fund that promises investors algorithmic, automated cryptocurrency trading. It was founded by Japheth Dillman and is now bankrupt due to fraudulent activity.
Cryptocurrency-related fraud losses surge
The Consumer Federation of America recently released a report estimating that Americans lost US$80.7 billion in cryptocurrency-related fraud and cybercrime in 2025. The organization based its estimates on data from the FBI, which recorded reported losses in cryptocurrency fraud of $11.37 billion last year, a 22% increase from 2024. The Consumer Federation of America, a coalition of nonprofit consumer rights organizations, adjusted the FBI's data based on a previous survey by the Bureau of Justice Statistics that concluded that only 14% of fraud cases were reported to law enforcement.
According to the FBI, cryptocurrency fraud accounted for more than half of all reported fraud and cybercrime losses in the United States last year, with investment scams accounting for the largest proportion, reaching $8.6 billion, a 32% increase from 2024.
The specific data are as follows: The FBI reported cryptocurrency fraud losses of $9.32 billion in 2024 and $11.37 billion in 2025; investment fraud losses increased from $6.52 billion in 2024 to $8.6 billion in 2025; The Consumer Federation of America estimates that the total cryptocurrency fraud losses in 2025 are $80.7 billion.
Officials stressed that since most victims did not report the case to authorities, the actual scale of the damage may be much higher. The Consumers Federation of America recommends that in response to these trends, we need to continue to be vigilant and take strong consumer protection measures.
