Taiwans Steaker Execs Face Charges Following FTX Collapse

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Taiwans Steaker Execs Face Charges Following FTX Collapse

• Steaker executives indicted for unlicensed crypto investment schemes worth $45.8M.
• Funds reportedly routed through FTX and used for high-risk trades and staff payments.
• Prosecutors link Steaker‘s operations to violations of Taiwan’s Banking Act.

Taiwanese authorities have charged four senior executives of digital asset management platform Steaker for allegedly raising NT$1.48 billion ($45.8 million) through unauthorized cryptocurrency investment schemes. The Taipei Prosecutors Office confirmed the charges Thursday, pointing to Banking Act rules about taking deposits without a license.

Steaker founder Huang Weixuan, Chief Technology Officer Xiu Minjie, Chief Marketing Officer Lu Tianxin, and Chief Operations Officer Pan Yiting face charges over the operation.

The prosecution has requested the court to penalize the company under the Banking Act. However, Huang, who has been released on bail, also faces additional charges for financial misconduct involving investor funds.

How Steaker Allegedly Drew Funds with Up to 88% Return Promises

According to prosecutors, Steaker operated multiple virtual currency investment plans beginning in 2019, promising investors returns ranging from 3.5% to 88% annually. The company raised funds in Tether, Bitcoin, and Ethereum while claiming the investments were protected by a user asset security fund, or SAFU, in partnership with security firm CYBAVO.

The charges allege that Steaker assured investors of principal and interest protection, a practice regulators have interpreted as deposit-taking without appropriate licenses. Over three years, the plans reportedly attracted hundreds of millions of dollars in New Taiwan.

Prosecutors: Steaker Investor Funds Sent to FTX, Lost in Collapse

Investigators report that once investor funds reached a certain threshold, they were transferred to wallets under Huangs control on FTX. According to the prosecution, these funds were used for profitable trading and high-return lending to capture price differences.

And when FTX collapsed in November 2022, Steaker thereby lost access to its funds and could not meet investor obligations. Additional findings show that a portion of the virtual assets were redirected from FTX to private currency traders and used to cover salaries for Steaker employees.

Steaker Founder: Are Crypto Assets ‘Deposits’ Under Taiwan Law？

Huang Weixuan responded to the charges in a Facebook post, stating that Steakers multi-chain asset flow and operations model should not be classified as money laundering.

The company also expressed concern over prosecutors interpretation of the Banking Act, particularly their decision to equate virtual assets with legal tender under the law.