Asset-Backed Crypto Token Wasn’t - Bloomberg

Alternative Titles

• Unicoin's audited filings quietly admitted what its tweets denied
• The crypto scheme where auditors told on the promoters
• A $3 billion token sale that was actually $110 million
• Private rooms are slowly de-anonymizing the US stock market

Key Takeaways

• Matt Levine opens with the classic 'magic beans' grift: two parties with unsellable assets (beans and worthless Poyais land) stage a huge bean-denominated land purchase at inflated notional prices, then separately pitch the beans and the land to outsiders citing the transaction as proof of market value. The Unicoin case, he argues, is a modern crypto version of that trick — except oddly executed with simultaneous honest SEC filings.
• Unicoin Inc. and executives Alex Konanykhin, Silvina Moschini and Alex Dominguez are charged by the SEC for promoting a supposedly 'asset-backed' token. Legally Unicoin never issued any tokens; it sold 'unicoin rights certificates' entitling holders to future tokens, with the 10-K warning there is 'no assurance as to whether, or at what amount, or on what terms' the tokens will ever be issued.
• The core weirdness: Unicoin is an SEC-registered company filing normal audited 10-Ks and 10-Qs even though neither its stock nor its tokens trade publicly. The SEC isn't alleging the financial statements are wrong — it's alleging the social-media promotions are false, and you can prove it by simply comparing them to Unicoin's own audited filings.
• Sales numbers were dramatically inflated. By June 2024, executives claimed on LinkedIn that Unicoin had 'exceeded $3B in Unicoin sales' and achieved '$3 billion in Unicoin sales,' but the audited Unicoin Rights Financing Obligation — booked as a liability refundable if tokens never launch — showed at most $110 million raised. Levine notes the liability treatment is actually conservative compared with promoters who book token sales as revenue.
• The 'assets' backing the tokens were largely fictional in value. Equity stakes obtained by featuring startups on the 'Unicorn Hunters' streaming show totaled about $8.2 million across seven companies. Real estate was supposed to come from a '140% program' paying 140% of appraised value in unicoin rights certificates, explicitly pitched to 'differentiate unicoins from assetless cryptocurrencies.'
• The Argentine mining rights saga crystallizes the gap. Unicoin announced in August 2023 it was paying 420,000,000 unicoins — a $210 million notional at $0.50 per token — for rights valued at $150 million. When auditors commissioned a real appraisal 15 months later it came in at $7.1 million, and by the 2024 10-K an auditor-retained mining specialist revalued it to $580,000 — less than 0.4% of the announced $150 million.
• Aggregate real-estate results are similarly brutal. Konanykhin's April 22, 2025 Investor Update claimed Unicoin had 'Closed over $2.5B of Real Estate for unicoins deals,' while the signed 2024 10-K showed less than $1.5 million of real estate actually acquired under the 140% program — a 99.94% discrepancy between unaudited promotion and audited reality.
• Even the 'asset-backed' concept was vibes-only. All three executives testified under oath they never intended tokens to be legally or technically backed by assets; Konanykhin analogized that crypto 'cannot be backed by something,' and Moschini said she meant only that the company owned some assets. A draft smart contract contained no mechanism tying token functionality to real-world asset liquidations or triggering events.
• Remarkably, Unicoin's own 10-K contains a risk factor confessing that promotional videos and 'Unicorn Hunters' episodes erroneously stated unicoins are 'registered with the SEC' — factually incorrect — attributing the errors to speakers' misunderstanding of the registration process and warning of possible enforcement action. The company essentially pre-disclosed the misconduct the SEC is now suing over.
• Levine's second topic: retail order flow as the most valuable resource in equity markets, because small retail traders are predictable 'bad counterparties' — when they sell 10 shares that's usually all they have, so buying doesn't expose you to a big institutional follow-on sell. A cited study ranks TD Ameritrade customers as the most desirable retail to trade with and Interactive Brokers Pro as the least (i.e., the sharpest).
• The dominant structure: retail brokers route to wholesalers like Citadel Securities or Virtu, who commit to filling every order, provide 'price improvement' vs. exchange prices to satisfy best-execution duties, and in some cases pay the broker directly ('payment for order flow'). Sending orders to anonymous exchanges instead would destroy the retail premium because nobody can tell which orders came from inept counterparties.
• 'Retail private rooms' inside dark pools like OneChronos and IntelligentCross are an emerging alternative. Bank brokers such as Evercore ISI and Wells Fargo (which moved retail flow to private rooms in late 2023) set up bilateral rooms matching a specific retail broker with a specific institution, letting counterparties know exactly who they're trading with. Citadel Securities has reportedly flagged concerns to regulators as the model grows.
• Taken to the limit, private rooms could fully de-anonymize equity trading: every firm picks exactly which counterparties it will trade with and pays more for 'worse' ones. T. Rowe Price's Mehmet Kinak frames the appeal as controlling trade quality by knowing the counterparty — inverting the historical selling point of anonymous exchanges.
• Pope Leo XIV's childhood Dolton, Illinois home was listed in January for $219,000, pulled May 8 hours after Cardinal Prevost's election, and relisted at luxury auction starting at $250,000. Dolton's attorney then sent a letter saying the village will seize the property by eminent domain for a historic site, which requires paying fair market value — presumably including the 'pope premium' that now can't be cleanly auctioned because buyers know any purchase 'may only be temporary.'
• A claimed Trumpcoin dinner arbitrage: buy enough Trumpcoin by the May 12 record date to qualify for the May 22 dinner while simultaneously shorting via perpetual futures. Because demand for futures exceeded demand for spot tokens, the funding rate paid the arbitrageur, letting a trader attend the dinner with no net token exposure and possibly a positive carry.

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