Todd faces a $12 million fine and around $4 million in disgorgement, though it is not clear whether Todd or the firm would have the resources to repay customers

The founder of crypto exchange Digitex, Adam Todd, has been directed by a federal court to pay nearly $16 million to settle allegations that he ran an illegal platform and sought to influence its native token, DGTX, the U.S. Commodity Futures Trading Commission (CFTC) said in a statement on Wednesday.

In closing what had been the CFTC’s first case that accused a decentralized-finance (DeFi) platform for failing to register as an exchange, a judge in the U.S. District Court for the Southern District of Florida found Todd breached a number of commodities laws in running the Digitex Futures exchange, and the judge instructed he be barred from trading in CFTC-regulated markets. Todd faces a $12 million fine and around $4 million in disgorgement, though it is not clear whether Todd or the firm would have the resources to repay customers.

This order settles yet another action against an individual and digital asset exchange illegitimately offering futures contracts to U.S. customers, according to Ian McGinley, the Commodity Futures Trading Commission’s enforcement director. He observed the court also found that Todd had tried to exploit Digitex’s native utility token, DGTX, by supposedly ‘pumping’ the token’s price through a computerized bot.

Todd has still been active as a developer of Digitex Games, which uses the DGTX token.

I did not steal customer funds or mislead investors or run a Ponzi or pretend there was a non-existent product or anything like that, Todd told CoinDesk. I started a cryptocurrency which reached a market capitalisation of $160 million and which then crashed as our product could not compete in a saturated market. That’s it. And now I have a $16 million fine for my efforts.

Todd added his firm tried to keep out U.S. customers, and he argued it was not ever possible for it to register with the Commodity Futures Trading Commission.