The founder of two digital currency ventures, including a $90 million hedge fund, has been sentenced to over seven years in prison on charges of defrauding the investors. Stefan He Qin, the founder of a hedge fund known as Virgil Sigma Fund LP, will also face three years of supervised release and forfeit over $54 million that was embezzled from his investors. Qin controlled New York-based Virgil Sigma from 2017 to 2020, purporting to employ arbitrage strategies to make profits. He touted his strategy to be market neutral, meaning that he would make money regardless of market conditions, authorities said. He reportedly raised $90 million from dozens of investors, many of them in the United States. He publicly claimed to have been profitable in every month from August 2016, with the sole exception of March 2017.\u00a0 In February 2020, Qin founded the second fund, known as VQR Multistrategy Fund LP. With this fund, he would speculate on market movements and was not market neutral as with his previous fund. He hired a head trader and other investment professionals to trade the investors\u2019 funds. However, since founding the first fund, Qin has been defrauding investors, the U.S. Department of Justice\u00a0alleges. He used a large portion of investor funds to pay for personal expenses such as food and rent for a New York penthouse, make investments in illiquid assets such as real estate and invest in ICOs. He ended up spending almost all the investors\u2019 money in Virgil Sigma fund. When investors demanded to redeem their investment, he tried to take funds from his second hedge fund, VQR to pay off the earlier investors. This was despite a warning from the head trader that unwinding their positions at the time would lead to losses for the investors. The 24-year-old Australian pleaded guilty to securities fraud earlier this year as CoinGeek\u00a0reported. U.S. District Judge Valerie Caproni has now sentenced Qin to 90 months in prison and three years of supervised release, and to forfeit $54,793,532.\u00a0 Follow\u00a0CoinGeek\u2019s Crypto Crime Cartel\u00a0series, which delves into the stream of groups\u2014a from\u00a0BitMEX\u00a0to\u00a0Binance,\u00a0Bitcoin.com,\u00a0Blockstream,\u00a0ShapeShift,\u00a0Coinbase,\u00a0Ripple and Ethereum\u2014who have co-opted the digital asset revolution and turned the industry into a minefield for na\u00efve (and even experienced) players in the market.