U.S. regulators have charged the founder and chief executive of bitcoin mining firm VBit Technologies Corp., accusing him of misleading thousands of investors and misappropriating nearly $50 million raised through what the Securities and Exchange Commission describes as fraudulent investment offerings.
In a complaint filed Wednesday in the U.S. District Court for the District of Delaware, the SEC alleged that Danh C. Vo, 37, orchestrated a scheme that raised more than $95.6 million from roughly 6,400 investors. According to the agency, Vo used at least $48.5 million of those funds for personal purposes, including gambling and sending large sums to family members.
Promises of easy, passive bitcoin income
VBit marketed itself as a way for everyday investors to earn passive income from bitcoin mining without having to manage equipment or technical operations. The company promoted what it called a “turnkey solution,” offering customers two main options: purchasing mining rigs outright or entering into hosting agreements that promised passive profits from mining operations run by VBit.
The SEC said most investors chose the hosting agreements, believing their money was tied to specific mining rigs generating bitcoin on their behalf.
However, regulators allege that VBit sold hosting agreements for far more mining rigs than the company actually owned or operated. As a result, many investors were led to believe they were earning returns from active mining equipment that did not exist at the scale advertised.
Alleged misrepresentations and misuse of funds
According to the complaint, Vo either knew or was reckless in failing to recognize that VBit did not have enough mining capacity to support the volume of hosting agreements it sold. As founder and CEO, Vo allegedly controlled the company’s messaging, including website content, marketing materials, and the data shown in investors’ online accounts.
The SEC also classified the hosting agreements as securities, arguing that investors were encouraged to expect profits generated primarily through the efforts of VBit and its management rather than their own actions.
In addition to misleading investors, the SEC claims Vo diverted millions of dollars for personal use. The agency said approximately $5 million was transferred to family members and his former spouse, all of whom are named as relief defendants in the case.
Departure from the U.S. and company shutdown
The complaint states that Vo, previously based in Philadelphia, filed for divorce in November 2021 and then left the United States with the remaining misappropriated funds. VBit was later acquired by Advanced Mining Group in 2022, but the company is now defunct, according to the SEC.
Vo has been charged with the unregistered offer and sale of securities, as well as fraud. The case adds to a growing list of enforcement actions targeting alleged misconduct in crypto-related investment schemes, particularly those promising predictable or passive returns.
A cautionary tale for crypto investors
The VBit case highlights ongoing concerns around transparency and accountability in crypto mining investments, especially when offerings resemble traditional securities but are marketed under the banner of emerging technology. As regulators continue to scrutinize the sector, the SEC’s action serves as a reminder that investor protections apply regardless of whether a product is built on blockchain or traditional financial infrastructure.
