SEC Sues Mining Automatic and Founder Over $22M Crypto Mining Scheme

The U.S. Securities and Exchange Commission sued Mining Automatic and its founder Zan Shaikh today, alleging they raised $22 million from over 380 investors between June 2023 and May 2025 while spending only about 13% on actual mining operations.

According to the SEC complaint, the company generated roughly $1.1 million from mining but paid investors approximately $1.8 million in purported returns, with the shortfall funded by money from new investors—exhibiting "hallmarks of a Ponzi scheme." The SEC alleged Shaikh used investor funds for $7 million in advertising, real estate, vehicles, and personal expenses. Mining Automatic stopped paying investors by March 2025, leaving more than $20 million in principal unpaid.