Feds arrest Princeton grad ‘Diamondhands’ who raised $257 million for fake crypto social media site
Nader Al-Naji had it all: an Ivy League education, a résumé that included a stint at Google, and connections to the top venture capitalists in Silicon Valley. Then it all came crumbling down. This week, the FBI arrested Al-Naji—who called himself “Diamondhands”—for fraud related to a cryptocurrency swindle that saw him take in hundreds of millions from investors and users to be part of “BitClout,” a short-lived social network that turned people into stock market investments.
In an indictment filed in New York federal court, the Securities and Exchange Commission alleges that Al-Naji promised investors that BitClout, which he created by scraping Twitter profiles without permission, was decentralized and that no one controlled the funds on the platform. In reality, he was helping himself to the money, and spending millions on a six-bedroom mansion in Beverly Hills and extravagant gifts to his wife and mother.
The BitClout debacle was not Al-Naji’s first crypto project. The 32-year-old Los Angeles resident, who was a rower while an undergrad at Princeton, first came to the crypto world’s attention when he raised $118 million in 2018 to develop a stablecoin called Basis. Unlike other stablecoins, which require a full reserve of dollars to create a $1 peg to the U.S. dollar, Basis relied on an algorithm—much like the infamous Terra coin that triggered the collapse of crypto markets in 2021. Al-Naji pulled the plug on Basis months after launching it, returning the money. (Al-Naji could not immediately be reached for comment.)
