Taiwan authorities have initiated legal actions against Steaker for running an unauthorized crypto investment scheme. According to reports, authorities charged the founder, Huang Weixuan, alongside other executives for their part in the investment scheme.

According to the authorities, the quartet were involved in allegedly using the Steaker platform to raise about $45.8 billion through unauthorized crypto investment schemes. The Taipei Prosecutors’ Office confirmed the charges on Thursday, noting that their acts are against the Banking Act rules which frowned upon taking deposits without a license.

According to the report, aside from the founder Huang Weixuan, the platform’s Chief Technology Officer Xiu Minje, Chief Marketing Officer Lu Tianxin, and Chief Operations Officer Pan Yiting are billed to face charges in connection with those allegations.

The prosecution also urged the court to move forward and penalize the company under the Banking Act, but it remains to be seen what will happen as the case still remains in court.

Taiwan authorities drag Steaker platform to court

According to filings, Huang is a blockchain legend in Taiwan, with the Steaker founder trading Bitcoin while he was at the National Taiwan University. He developed a crypto wallet before going to work as a software engineer at Yahoo. After he left Yahoo, he founded Steaker in 2019, noting that he had amassed about $55 million in assets under management in two years. He is also regarded as one of the leaders in the blockchain space in the country.

According to Taiwanese prosecutors, Steaker operated multiple digital asset investment plans since its inception. The company began operations in 2019 and sold investors the promise of huge returns ranging from 3.5% to 88% annually. The company raised funds in several digital assets, including USDT, Bitcoin, and Ethereum. The platform also claimed that assets deposited by its users were protected by a security fund, noting that it was in partnership with CYBAVO.

According to the charge sheet, the prosecutors allege that Steaker assured its investors of protecting their principal and interests, a move that regulators have called taking deposits without licenses. Over the next three years, the company, through its various plans, attracted hundreds of millions of dollars in Taiwan.

FTX’s collapse in 2022 caused problems for Steaker

Investigators also mentioned that once investor funds reached a certain amount, there were specific instructions to move them to a wallet under the control of Huang on the collapsed cryptocurrency exchange, FTX. According to the prosecutors, Huang and his team used the money for profit trading, and high-return lending to capture price differences.

Problems started for Steaker and its executive after the collapse of FTX in 2022. The platform filed for bankruptcy in 2022, leading to funds belonging to individuals and firms being locked on the platform. With the funds locked on FTX, Steaker could not meet investor withdrawal obligations, which in turn led to its collapse. Prosecutors also mentioned that some of the digital assets collected were moved from the FTX wallet held by Huang to wallets belonging to private currency traders and sometimes used to cover salaries.

Huang has responded to the charges, noting that Steaker uses a multi-chain asset flow and operations and by that, the prosecutors can not classify it as money laundering. The company also objected to the way the prosecutors were choosing to interpret the Banking Act, especially with the way they decided to equate digital assets and legal tender under the law.

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