Texas State Securities Board Accuses GS Network of Fraudulent Activities Linked to Metaverse Property Sales

According to Cointelegraph, the Texas State Securities Board has accused a network of companies under the "GS" brand, controlled by Josip Dortmund Heit and operating from Germany, of fraudulent activities related to digital assets and investments in a staking pool in a proprietary metaverse. The companies, GS Partners, GS Smart Finance, and GS Wealth, allegedly held three rounds of metaverse property sales beginning in September 2021. Investors were informed that they could purchase XLT Vouchers, or BNB Chain tokens representing ownership of one square inch of a unit in the company's G999 Tower metaverse, at 9.63 Tether (USDT) per voucher. However, the token's value rapidly decreased to less than 0.0000049 USDT apiece on decentralized exchange PancakeSwap after the respondents failed to reach their $175 million raise target for the offering. The regulators allege that other investment products created by GSB, such as its Lydian World metaverse tokens, gold tokens, G999 coin, and Elemental Certificates, also constituted unregistered security offerings. The Texas State Securities Board has filed an emergency enforcement action for the GSB group of companies to cease and desist from such activities in the state. Previously, the Ontario Securities Commission issued a warning on August 15 that GS Partners was not registered to do business in the Canadian province of Ontario. Securities regulators in the Canadian provinces of Saskatchewan, British Columbia, Alberta, and Quebec have also published warnings regarding the firm.