--- description: A Texas man was charged with fraud in New York on Thursday, in what federal authorities claim is the first Ponzi scheme involving Bitcoin. title: Man Accused of Bitcoin Ponzi Scheme image: https://static.time.com/v3/assets/bltea6093859af6183b/bltde093bcdab65f2d0/6988d9b9bc6cfc69913e2a3c/time-logo.jpg?branch=production --- * [U.S.](/section/us/) ## U.S. Update your preferences in [Account Settings](/account/preferences/) Close # Man Accused of Running the First Ever Bitcoin Ponzi Scheme by [Rishi Iyengar](/author/rishi-iyengar/) ## Rishi Iyengar Update your preferences in [Account Settings](/account/preferences/) Close Nov 7, 2014 4:26 AM CUT by [Rishi Iyengar](/author/rishi-iyengar/) ## Rishi Iyengar Update your preferences in [Account Settings](/account/preferences/) Close Nov 7, 2014 4:26 AM CUT A Texas man was charged with fraud in New York on Thursday, in what federal authorities claim is the first-ever Ponzi scheme involving the unregulated digital currency Bitcoin. Trendon Shavers, 32, who runs a company called Bitcoin Savings and Trust, allegedly raised the equivalent of $4.5 million by offering investors weekly interest rates of 7%, Reuters [reports](http://www.reuters.com/article/2014/11/06/us-bitcoin-charges-idUSKBN0IQ21I20141106 "undefined"). That translates to a 3,641% annual rate of return. Shavers is suspected of embezzling about 146,000 of the 764,000 bitcoins he raised between Sept. 2011 and Sept. 2012 and allegedly using the proceeds to buy a BMW sedan, spa treatments and a $1,000 steak dinner, among other things. If convicted, Shavers could serve up to 20 years in prison. “This case, the first of its kind, should serve as a warning to those looking to make a quick buck with unsecured currency,” said U.S. Attorney Preet Bharara in a statement. \[[Reuters](http://www.reuters.com/article/2014/11/06/us-bitcoin-charges-idUSKBN0IQ21I20141106 "undefined")\] ```json [{"@context":"https://schema.org","@type":"NewsArticle","@id":"https://time.com/3571415/bitcoin-ponzi-scheme-trendon-shavers-bitcoin-savings-and-trust/","mainEntityOfPage":{"@type":"WebPage","@id":"https://time.com/3571415/bitcoin-ponzi-scheme-trendon-shavers-bitcoin-savings-and-trust/"},"headline":"Man Accused of Running the First Ever Bitcoin Ponzi Scheme","datePublished":"2014-11-07T04:26:35.000Z","dateModified":"2026-04-13T08:03:37.644Z","description":"He allegedly raised the digital equivalent of $4.5 million by offering insanely high interest rates","url":"https://time.com/3571415/bitcoin-ponzi-scheme-trendon-shavers-bitcoin-savings-and-trust/","keywords":["Tech","Texas","Crime","Bitcoin","fraud","Ponzi Scheme"],"thumbnailUrl":"","author":[{"@type":"Person","name":"Rishi Iyengar","jobTitle":null,"url":"https://time.com/author/rishi-iyengar/"}],"articleSection":"U.S.","image":[],"publisher":{"@type":"Organization","name":"Time","url":"https://time.com/","logo":{"@type":"ImageObject","url":"https://time.com/images/logo.png","width":528,"height":156},"foundingDate":"March 3, 1923","sameAs":["https://www.facebook.com/time","https://www.instagram.com/time/?hl=en","https://twitter.com/time","https://www.pinterest.com/timemagazine"]}},{"@context":"https://schema.org","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"item":{"@id":"/section/us/","name":"U.S."}},{"@type":"ListItem","position":2,"item":{"@id":"https://time.com/3571415/bitcoin-ponzi-scheme-trendon-shavers-bitcoin-savings-and-trust/","name":"Man Accused of Running the First Ever Bitcoin Ponzi Scheme"}}]}] ```