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Court orders Brazil’s ‘bitcoin pharaoh’ to deposit $3.7 billion to pay back creditors: O Globo


www.theblock.co 21 September 2022 08:07, UTC
Reading time: ~2 m

A Rio de Janeiro federal court judge has ordered Brazil’s so-called “Bitcoin Pharaoh” Glaidson Acácio dos Santos to pay 19 billion Brazilian reais (nearly $3.7 billion) to a business court, with the aim of reimbursing investors and creditors that lost money in a Ponzi scheme his company allegedly participated in.

Dos Santos had 72 hours to deposit the funds after the September 19 decision, Brazilian newspaper O Globo and its sister outlet G1 first reported. 

The business owner has been ordered to deposit the funds to a business court, the reports said, which would eventually be passed on to the creditors and investors that did business with Dos Santos’ firm, G.A.S. Consultoria e Tecnologia. The debts would only be paid out to creditors if the company can prove their lawful origin, O Globo reported. 

Dos Santos, a former waiter, has been in jail on charges related to a pyramid scheme called Operation Kryptos. Brazil’s federal police said in August 2021 that it had seized 591 bitcoins (then worth nearly $28 million) as part of the operation, among other items like watches, jewelry and documents. 

More than 122,000 investors have registered on a G.A.S creditor website, O Globo reported, and they are seeking about $9 billion Brazilian reais so far. The news outlet also reported on September 15 that a federal regional court had newly granted habeas corpus to Dos Santos. 

Whether Dos Santos will pay the court-ordered amount remains unclear. 

Last week, a regional electoral court in Rio de Janeiro unanimously voted to block Dos Santos’ candidacy for a congressional deputy seat. 

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