Here’s what happened in crypto today

Today in crypto, US prosecutors allege Edward Zimbardi collected crypto from thousands of investors, lost over $34 million on currency trades and spent at least $10 million personally. The US Treasury advanced proposed rules for implementing the GENIUS Act, while BitMart’s official Chinese-language X account demanded answers from founder Sheldon Xia over user funds.

Alleged $165M crypto Ponzi mastermind faces US charges after Fiji deportation

Edward Zimbardi, the alleged mastermind of a $165 million crypto Ponzi scheme, was returned to the United States after being deported from Fiji to face federal fraud and money laundering charges. 

On Monday, the US Attorney’s Office for the Northern District of Georgia said that Fijian authorities deported Zimbardi on Friday in coordination with the FBI and State Department. He was scheduled to appear before a federal magistrate judge in Los Angeles, with prosecutors seeking his detention pending proceedings in Georgia. 

Prosecutors allege Zimbardi promoted a scheme called “The Crypto Program” from June 2022 to August 2023 as an advertising-package investment promising guaranteed returns of 25% monthly. Thousands of investors allegedly sent over $165 million in crypto to wallets he secretly controlled. 

Instead of purchasing advertising packages, Zimbardi allegedly placed more than $34 million in risky foreign currency trades, used later investments to pay off earlier investors and spent at least $10 million on personal expenses, including a house, luxury vehicles and alimony. 

Zimbardi was indicted July 8 on 12 counts of wire fraud, 12 counts of money laundering and one money laundering conspiracy count. Prosecutors allege he fled to Fiji after learning of the FBI investigation and remained there for more than a year.

US Treasury advances GENIUS Act rules ahead of 2027 rollout

The US Treasury Department moved forward with proposed rules for the GENIUS Act on Monday, opening a 60-day public comment period as regulators race to implement the landmark stablecoin law.

The proposal addresses how Treasury will interpret and enforce key provisions of the law, including requirements that generally prohibit entities from issuing payment stablecoins in the United States without an appropriate federal or state license.

Signed into law in July 2025, the GENIUS Act is scheduled to take effect on Jan. 18, 2027, or 120 days after regulators finalize implementing rules, whichever comes first.

Treasury is one of several agencies working to establish the regulatory framework. The Office of the Comptroller of the Currency, Federal Deposit Insurance Corporation and Federal Reserve have also proposed rules this year.

However, agencies missed a July deadline that would have allowed final regulations to take effect before January. That raises the possibility that the GENIUS Act could take effect before regulators have completed all the rules needed to implement it.

BitMart account demands founder explain funds status, Xia calls claims ‘fabricated’

BitMart’s official Chinese-language X account has publicly demanded that founder Sheldon Xia explain the whereabouts of user funds and produce a repayment plan by Wednesday.

The account said in a Monday post that some users remained unable to withdraw funds and that some employees had not received their final salary or compensation, while calling on Xia to disclose BitMart’s wallets, assets, liabilities and available reserves, according to a machine translation of the post.

The post said if Xia does not provide a verifiable asset disclosure and repayment plan by the deadline, it would continue to submit evidence to regulators, law enforcement, lawyers and the media.

It was unclear who authored Monday’s post or whether the account remained under the company’s control. Cointelegraph contacted BitMart for comment but did not immediately receive a response.

BitMart announced on July 26 that it would wind down its exchange as its BMX token plunged and users reported withdrawal delays. The company said trading on the platform will end on Aug. 26 and operations will cease on Jan. 31.