1 hour ago
22
Liu Zhou, the 39-year-old founder of crypto market-making firm MyTrade, was sentenced in US District Court in Boston for conspiracy to commit market manipulation and wire fraud. His punishment: a $10,000 fine and a court order to shut down the wash trading bots that powered his entire business model.
No prison time. For a guy who ran bots that faked trading volume across roughly 60 digital assets, the sentence lands somewhere between a slap on the wrist and a firm handshake goodbye.
What MyTrade actually did
MyTrade’s bots would execute simultaneous buy and sell orders on the same token, often within the same second, creating the illusion of real market activity where none existed.
MyTrade, registered in the British Virgin Islands, launched in 2021 and didn’t exactly hide what it was doing. The company openly advertised tools for wash trading and pump-and-dump schemes. In English: they sold a service that made garbage tokens look like they had genuine investor interest, luring real traders into markets built on fabricated demand.
Zhou operated between China and Canada while running these operations, managing what prosecutors identified as one of three primary market makers involved in illicit trading schemes uncovered during the investigation.
The “self-trades” his bots executed weren’t subtle. They were simultaneous buy-and-sell orders, matched against each other, designed purely to inflate volume numbers that investors rely on when deciding whether a token is worth their money. Around 60 digital assets got the MyTrade treatment, meaning their trading volumes were, at least partially, fiction.
Operation Token Mirrors and the FBI’s crypto sting
Zhou’s case didn’t happen in isolation. It was part of the FBI’s “Operation Token Mirrors,” a broader initiative targeting market manipulation in crypto.
Federal agents actually created their own token, NexFundAI, on the Ethereum blockchain. The token existed solely to bait market makers into demonstrating their illicit practices on the record.
Zhou entered his guilty plea on October 30, 2024, making him the first market maker to plead guilty in this wave of crypto enforcement actions. His sentencing came on August 5, 2026.
Why a $10,000 fine raises eyebrows
MyTrade ran bots that manipulated volume across 60 tokens for years, misleading potentially thousands of retail investors who made trading decisions based on fabricated data. The fine amounts to less than what many crypto traders lose on a bad Tuesday afternoon.
The court-ordered deactivation of MyTrade’s wash trading bots is arguably the more consequential part of the sentence. It effectively kills the business model entirely, shutting down the infrastructure that made the manipulation possible in the first place.
Zhou’s guilty plea confirms that wash trading in crypto markets can be prosecuted as wire fraud and market manipulation under existing US law. Prosecutors didn’t need new crypto-specific legislation to bring charges.
MyTrade was identified as one of three main market makers caught in Operation Token Mirrors, meaning other cases are likely still working through the system.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
English (US) ·