SEC v. Jake Soberal; and Irma Olguin, Jr., No. 1:23-cv-01585-BAM, Eastern District of California (Nov. 15, 2023) — Complaint

COMPLAINT
SEC V. SOBERAL, ET AL.

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MONIQUE C. WINKLER (Cal. Bar No. 213031)
[email protected]
JASON H. LEE (Cal. Bar No. 253140)
[email protected]
RAHUL KOLHATKAR (Cal. Bar No. 261781)
[email protected]
MARC D. KATZ (Cal. Bar No. 189534)
[email protected]
DREW LIMING (Cal. Bar No. 305156)
[email protected]

Attorneys for Plaintiff
SECURITIES AND EXCHANGE COMMISSION
44 Montgomery Street, Suite 2800
San Francisco, California  94104
Telephone:  (415) 705-2500
Facsimile:   (415) 705-2501
SECURITIES AND EXCHANGE COMMISSION,

Plaintiff,

v.

JAKE SOBERAL, and
IRMA OLGUIN, JR.,

Defendants.
Case No.

COMPLAINT

JURY TRIAL DEMAND

Plaintiff Securities and Exchange Commission (the “Commission” or “SEC”) alleges:
SUMMARY OF THE ACTION
1. In 2022, Defendants Jake Soberal and Irma Olguin, Jr. (together, “Defendants”)
falsified documents and misled investors while raising approximately $70 million. Defendants
were the co-founders and co-CEOs of Fresno-based Bitwise Industries, Inc. and its corporate

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

FRESNO DIVISION

COMPLAINT
SEC V. SOBERAL, ET AL.

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parent, BW Industries, Inc. (together, “Bitwise”). Bitwise offered technology training, software
development, and real estate management services.
2. In connection with Bitwise’s Series B-2 securities offering in 2022, Defendants
made false and misleading statements to investors, including inflating the company’s key
financial metrics. To substantiate their false claims, Defendants also provided several investors
with fabricated documents, including altered bank statements and a falsified audit report.
Approximately 20 investors, including individuals, institutional investors, and venture funds,
participated in Bitwise’s Series B-2 offering.
3. Defendants represented to investors that Bitwise had significant revenue and
maintained healthy cash balances. But the strong financial picture Defendants painted was, in
fact, a sham. Soberal and Olguin knew that Bitwise had generated far less revenue than what
they told investors. In addition, Soberal and Olguin told investors that Bitwise had substantial
cash balances while concealing that the company regularly lacked cash and struggled to pay
employees and other operational expenses. Defendants also lied to investors about an audit of
Bitwise’s financial statements by an outside auditor and even provided an investor with a
falsified document related to the audit.
4. Defendants’ scheme unraveled in late May 2023, when Bitwise ran out of cash
and could not pay its employees. Defendants then informed the company’s Board of Directors
(the “Board”)—which included representatives of several large investors—of Bitwise’s true
financial condition. The next day, all of Bitwise’s approximately 900-person workforce was
indefinitely furloughed. Several days later, the Board terminated Defendants as co-CEOs.
5. On June 28, 2023, the Board filed a petition for Chapter 7 bankruptcy in the
United States District Court for the District of Delaware on behalf of Bitwise Industries, BW
Industries, and several related entities. These entities are all currently in liquidation proceedings.
6. As a result of the conduct alleged in this Complaint, Defendants violated the
antifraud provisions of the federal securities laws. Specifically, Defendants violated Section
10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. § 78j(b)] and Rule

COMPLAINT
SEC V. SOBERAL, ET AL.

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10b-5 thereunder [17 C.F.R. § 240.10b-5], as well as Section 17(a) of the Securities Act of 1933
(“Securities Act”) [15 U.S.C. § 77q(a)].
7. In this action, the Commission seeks permanent injunctions, disgorgement of ill-
gotten gains with prejudgment interest, and civil monetary penalties. The Commission also seeks
an order (1) restraining and enjoining Defendants from directly or indirectly, including, but not
limited to, through any entity owned or controlled by them, participating in the issuance,
purchase, offer, or sale of any securities, provided however, that such injunction shall not
prevent them from purchasing or selling securities for their own personal accounts; and (2)
imposing officer and director bars.
JURISDICTION AND VENUE
8. The Commission brings this action pursuant to Sections 20(b), 20(d), and 22(a) of
the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)] and Sections 21(d), 21(e), and 27 of
the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa].
9. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d)(1),
and 22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d)(1), and 77v(a)] and Sections 21(d),
21(e), and 27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa].
10. Defendants, directly or indirectly, made use of the means and instruments of
interstate commerce or of the mails in connection with the acts, transactions, practices, and
courses of business alleged in this Complaint.
11. Venue is proper in this District pursuant to Section 22(a) of the Securities Act [15
U.S.C. § 77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. § 78aa(a)]. Acts,
transactions, practices, and courses of business that form the basis for the violations alleged in
this Complaint occurred in this District. Defendants met with and solicited prospective investors
in this District, and offers and sales of securities took place in this District.
12. Intradistrict assignment to the Fresno Division is proper pursuant to Rule 120(d)
of the Court’s Local Rules because a substantial part of the acts and transactions constituting the
violations alleged in this Complaint occurred in Fresno County, and Defendants reside in Fresno
County.

COMPLAINT
SEC V. SOBERAL, ET AL.

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DEFENDANTS
13. Jake Soberal, age 37, is a resident of Fresno, California. Soberal co-founded
Bitwise and was its co-Chief Executive Officer until June 2023. Soberal was admitted to the
California State Bar in November 2011.
14. Irma Olguin, Jr., age 42, is a resident of Caruthers, California. Olguin co-
founded Bitwise and was its co-Chief Executive Officer until June 2023.
RELATED ENTITIES
15. BW Industries, Inc. (“BWI”) is a Delaware corporation with its principal place
of business in Fresno, California. It is the parent entity of Bitwise Industries. BWI and its
securities are not registered with the Commission in any capacity. On June 28, 2023, BWI’s
Board of Directors filed a petition for bankruptcy on behalf of BWI, Bitwise Industries, and
several other BWI subsidiaries. These entities are currently in liquidation.
16. Bitwise Industries, Inc. is a California corporation with its principal place of
business in Fresno, California. It is a wholly-owned subsidiary and was the operating entity of
BWI. Bitwise Industries and its securities are not registered with the Commission in any
capacity.
FACTUAL ALLEGATIONS
I. Bitwise and its Business
17. Soberal and Olguin co-founded Bitwise in 2013. Prior to co-founding Bitwise,
Soberal worked as an intellectual property lawyer and Olguin founded several other start-ups.
18. Bitwise had three core businesses: (1) a “Workforce” business focused on
providing apprenticeship training for technology jobs; (2) an “Enterprise Solutions” business
providing project-based systems implementation and software development; and (3) a
“Community” business focused on developing and managing a commercial real estate portfolio.
Its stated mission was to revitalize what it called “underdog cities” by supporting their
development of technology industries.

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19. Soberal and Olguin founded and headquartered Bitwise in Fresno. Before its
collapse in 2023, Bitwise announced that it had expanded to other cities around the United
States, including Bakersfield, Merced, Toledo, Buffalo, and El Paso.
20. As co-CEOs, Defendants operated Bitwise together, and employees saw them as
joint decisionmakers. In general, Soberal managed Bitwise’s real estate portfolio, while Olguin
oversaw the technology consulting business. Both Soberal and Olguin were involved in
Bitwise’s fundraising efforts. They both communicated with potential investors through phone
calls, text messages, emails, video conferences, and in-person meetings. Defendants jointly
discussed and agreed upon any significant decisions involving Bitwise’s fundraising.
II. Defendants Raised Approximately $70 Million in 2022
21. In 2022, Defendants knew that Bitwise needed additional funding to pay
operating expenses. They decided to conduct a “Series B-2” offering that consisted of a mix of
existing and new investors. Between June and December 2022 (the “Series B-2 Period”), Bitwise
raised approximately $70 million from institutional, venture, and individual investors in its
Series B-2 round. Some of the investors were social impact funds, which invest in companies
that can both provide a positive financial return to the investor and benefit society or the
environment.
22. The Series B-2 investors invested in Bitwise in large part because Soberal and
Olguin represented to them that Bitwise had a growing business, including significant revenue
growth, gross margins over 40%, and large cash balances. Many of the investors were also
interested in Bitwise’s purported ability to grow a profitable business while generating economic
development in underserved communities.
III. Defendants Solicited Investors Through False and Misleading Statements
23. While raising money during the Series B-2 Period, Defendants made numerous
false and misleading statements and provided falsified documents to investors because they
knew the underlying facts would have revealed Bitwise’s poor financial condition.

COMPLAINT
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A. Defendants Misrepresented Bitwise’s Revenue and Gross Margins
24. In connection with the Series B-2 offering, Defendants prepared and provided
investors with financial statements that stated that Bitwise had realized significant, consistent
revenue growth. According to these financial statements, Bitwise had $59 million in annual
revenue in 2021 and had increased its revenue in each successive quarter in 2021—from $8.4
million in the first quarter to $21.6 million in the fourth quarter.
25. The Stock Purchase Agreement for the Series B-2 offering, which was signed by
Olguin on behalf of the company, represented that the financial statements provided to investors
had been “prepared in accordance with generally accepted accounting principles (‘GAAP’)
applied on a consistent basis[.]” It also represented that Bitwise “maintains a standard system of
accounting established and administered in accordance with GAAP.” GAAP is important to
investors because it provides rules for consistent accounting that allow investors to compare
companies’ financials, including their revenue, with one another.
26. Despite the representations to investors, Defendants knew, or were reckless in not
knowing, that the financial statements they provided to investors were not prepared in
accordance with GAAP. For example, shortly before the Series B-2 Period, employees in
Bitwise’s finance department explained GAAP reporting to Defendants and informed them that
the revenue numbers Defendants had been reporting externally were not compliant with GAAP.
In addition, Defendants knew that in April 2022, Bitwise’s outside auditor had significantly
reduced the company’s prior revenue numbers because the revenue that had previously been
reported by Defendants was not compliant with GAAP.
27. In spite of these warnings, Defendants continued to prepare and provide investors
with non-GAAP revenue numbers throughout the Series B-2 Period. Defendants prepared
Bitwise’s externally-reported financials themselves rather than rely on the company’s finance
department. Defendants excluded Bitwise’s finance department from the financial reporting
process because that gave them an opportunity to diverge from GAAP standards and inflate
Bitwise’s revenue.

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28. Defendants’ non-GAAP revenue numbers were higher than if they had been
prepared using GAAP, because Defendants included financial line items that were impermissible
under GAAP. For example, under GAAP’s accrual accounting rule, revenue for long term deals
with customers is recognized only for the periods in which it is actually earned rather than all
upfront. By contrast, Defendants counted the full value of deals as upfront revenue because that
allowed them to inflate the revenue numbers. In addition, Defendants sometimes included
proposed deals that lacked signed contracts as revenue, which is impermissible under GAAP’s
rules. If Bitwise’s revenue had been prepared in accordance with GAAP, its 2021 annual revenue
was less than $59 million and its 2021 quarterly revenue did not grow from $8.4 million to $21.6
million.
29. Defendants also provided investors with financial statements that falsely stated
that Bitwise had gross margins of approximately 47% in 2021. Gross margins compare a
company’s profits and costs to its revenue. Positive gross margins mean that a company
generates profit with each dollar earned, while negative gross margins mean that a company
loses money with each dollar earned. A gross margin of 47% meant that for every dollar Bitwise
received as revenue, it generated 47 cents of profit and the remaining 53 cents were the cost of
generating that dollar of revenue. Bitwise’s purported 47% gross margin misled investors into
believing that its revenue exceeded its production costs and that it had a growing, financially
stable business.
30. Because Defendants had inflated Bitwise’s revenue by including financial line
items that were impermissible under GAAP, Bitwise’s gross margins were consequently also
inflated. Rather than having gross margins of approximately 47%, Bitwise had negative gross
margins in 2021. In other words, instead of turning a profit, Bitwise was losing money and could
continue operating only by relying on additional investor or other outside capital.
31. Defendants’ misrepresentations regarding Bitwise’s revenue and gross margins
were important to investors because they falsely painted the picture of a rapidly growing,
financially sustainable company, which increased the likelihood that investors would obtain a
favorable return on their investments.

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B. Defendants Misrepresented Bitwise’s Cash Balances
32. Throughout the Series B-2 Period, Defendants also made false and misleading
statements to investors about Bitwise’s available cash. They regularly inflated Bitwise’s cash
balances, which made it appear as if Bitwise had far more cash on hand than it actually did. For
example, in connection with the Series B-2 offering, Defendants prepared and provided investors
with financial statements that stated that Bitwise’s quarterly cash balances dating back to the first
quarter of 2020 purportedly never fell below $9.4 million. These financial statements also
represented that Bitwise had $29.4 million in cash as of the end of March 2022. And in a
November 2022 presentation to the Board, Defendants represented that Bitwise then had over
$67 million in cash. All of these reported cash balances were false.
33. Defendants knew, or were reckless in not knowing, that the information about
Bitwise’s cash balances they provided to investors was false and misleading because, before and
throughout the Series B-2 Period, Bitwise faced repeated cash shortages and was unable to pay
its regular operating expenses until it received additional funding. Following Bitwise’s collapse
in May 2023, Defendants admitted to the Board that the cash balances they had provided to
investors were misleading because Defendants had combined both cash and illiquid real estate
and represented them collectively as “cash” in order to inflate the company’s cash balances.
34. Defendants also faked documents to misrepresent Bitwise’s available cash to
investors. For example, in June 2022, Olguin sent to an investor preparing a diligence
memorandum for the Series B-2 offering a screenshot of a purported Bitwise checking account
statement that showed a balance of $42.6 million as of December 31, 2021, and $23.4 million as
of March 31, 2022. This screenshot was falsified. The relevant checking account had a balance
of $11.7 million as of December 31, 2021, and only $325,100 as of March 31, 2022. Before
Olguin sent the faked screenshot to the investor, Defendants discussed creating it and altering the
underlying financial information, then jointly agreed to do so.
35. Because Bitwise’s revenue was far lower than Defendants represented, the
company was unable to generate sufficient money to pay employees and other basic operating
expenses. Despite their representations to investors about Bitwise’s cash balances, Defendants

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were aware of the company’s lack of cash because they both had access to Bitwise’s bank
accounts and actively managed Bitwise’s payments. For example, throughout the Series B-2
Period, Defendants regularly instructed lower-level employees to issue paper payroll checks
instead of direct deposits, short-pay credit cards, and withhold payment to vendors while they
sought additional sources of money.
36. In summer 2022, Defendants took out a number of loans—including high-interest
loans—to keep Bitwise financially afloat while they continued to solicit investor funds.
Defendants did not disclose these loans to the Board or investors. These undisclosed loans meant
that investor funds were used to repay loans and their accompanying fees rather than to operate
and grow Bitwise, as Defendants had represented to investors.
37. Defendants also personally profited from Bitwise’s cash struggles. They
repeatedly made personal short-term loans to Bitwise that they signed on behalf of Bitwise as
both borrower and guarantor. Defendants paid themselves a significant fee for these loans, which
were for periods as short as a single day. For example, on April 4, 2023, Olguin loaned Bitwise
$220,000. The following day, Bitwise wired her $247,000, thus providing her with proceeds of
$27,000 for a one-day loan.
38. The existence of these self-dealing loans was not disclosed to investors, and
Defendants used money Bitwise raised in the Series B-2 offering to repay their loans and pay
themselves the accompanying fees. For example, in September 2022, Soberal instructed an
employee in the finance department to pay off his and Olguin’s loans when Bitwise received $5
million from an investor.
39. Defendants’ misrepresentations regarding Bitwise’s cash balances were
significant to investors because they presented the company as financially healthy when it was
struggling to pay bills, incurring increasing loan debt, and in financial distress.
C. Defendants Misrepresented Bitwise’s Audited Financial Statements
40. Prior to 2020, Bitwise did not have audited financial statements. In October 2020,
Bitwise hired an outside auditor to audit its financial statements for its 2020 fiscal year.

COMPLAINT
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41. The auditor issued its opinion in April 2022. The audited financial s tatements
differed significantly from the financial statements Defendants had previously presented
externally because the auditor could not find support for many of the assets or revenue
Defendants claimed existed. For example, the audited financial  s tatements reduced Bitwise’s
total assets from $87 million to $42 million, reduced its revenue from $31 million to $9 million,
and increased its net loss from $7 million to $26 million.
42. During the Series B-2 Period, investors asked Defendants for Bitwise’s audited
financial s tatements. Given the disparity between the audited financial s tatements and the
financial s tatements Defendants had previously provided these investors, Defendants sought to
withhold the audited financial statements from those who requested them. In July 2022—four
months after the audit was complete and had been provided to Bitwise—Soberal and Olguin
each falsely stated in response to direct questions from investors that the audit of the 2020
financial s tatements was still underway and that they could not provide audited financial
statements at the time.
43. Defendants knew, or were reckless in not knowing, that the information they told
investors regarding the audited financial s tatements was false and misleading. Their
misrepresentations regarding the availability of Bitwise’s audited financial s tatements were
important to investors because the audited financial s tatements would have revealed Bitwise’s
true financial condition and made investors less likely to participate in the Series B-2 offering.
44. Defendants also created a fake audited financial statement. In September 2022,
one investor who had planned to make a $10 million investment reduced the size of its
investment to $5 million based in part on the lack of audited financial s tatements. In December
2022, Soberal and the investor discussed the possibility of it investing the additional $5 million it
had earlier withheld. To solicit the additional $5 million from the investor, Soberal and Olguin
jointly agreed to falsify the audited financial statements to significantly improve the appearance
of Bitwise’s financial condition. Soberal then falsely told the investor that the audit had recently
been completed and attached a document that he represented was the audited financial
statements.

COMPLAINT
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45. The document Soberal sent to the investor was fraudulent. Defendants dated the
document December 1, 2022, while the real audited financial statements were dated April 7,
2022. Defendants included financial statement line items in this fraudulent document that
differed significantly from those in the real audited financial statements. Defendants inflated
Bitwise’s total assets and revenue, while understating its net loss. Shortly after receiving the fake
audited financial statements from Soberal, the investor made an additional $5 million investment
in Bitwise’s Series B-2 offering.
IV. Soberal and Olguin’s Scheme Fell Apart When They Were Unable to Continue
Raising Money
46. Despite Bitwise’s increasing financial problems, Soberal and Olguin continued to
conceal the company’s true state. For example, in March 2023, Defendants represented to the
company’s Board that, as of December 31, 2022, the company had over $77 million of cash on
hand.
47. Aware of Bitwise’s actual cash shortages, Defendants continued to seek sources
of money to fund the company. In early 2023, Bitwise, under the direction of Soberal, took out
over $20 million in loans secured by real estate that purportedly belonged to Bitwise. In
connection with these loans, Soberal provided the lender with documents appearing to show that
Bitwise’s Board had approved the transactions. Defendants forged the Board’s signatures on
these documents, and the Board was not informed about these loans.
48. On May 28, 2023, Defendants alerted Bitwise’s Board about the company’s
financial distress and that it lacked the ability to make payroll. At an emergency meeting the
following day, Defendants were unable to explain to the Board what had happened with the
investor money Bitwise had raised, and, for the first time, disclosed that the company owed over
$20 million in private loans.
49. On May 29, 2023, Soberal and Olguin held a video conference for Bitwise’s
entire workforce. On that video conference, they read a prepared statement informing Bitwise’s
personnel that they were all immediately furloughed and that their previously issued paychecks
might bounce.

COMPLAINT
SEC V. SOBERAL, ET AL.

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50. On June 3, 2023, the Bitwise Board announced that it had terminated Soberal and
Olguin and that one of the Board members would serve as interim CEO.
51. On June 28, 2023, the Board filed a petition for Chapter 7 bankruptcy in the
United State District Court for the District of Delaware on behalf of BWI, Bitwise Industries,
and several related entities. These entities are all currently in liquidation proceedings.
FIRST CLAIM FOR RELIEF
Violations of Section 10(b) of the Exchange Act and Rule 10b-5
52. The Commission realleges and incorporates by reference paragraphs 1 through
51.
53. Defendants, by engaging in the conduct described above, directly or indirectly, in
connection with the purchase or sale of securities, by use of means or instrumentalities of
interstate commerce, or of the mails, with scienter:
a. Employed devices, schemes, or artifices to defraud;
b. Made untrue statements of material facts or omitted to state material facts
necessary in order to make the statements made, in the light of the
circumstances under which they were made, not misleading; and
c. Engaged in acts, practices, or courses of business which operated or
would operate as a fraud or deceit upon other persons, including
purchasers of securities.
54. By reason of the foregoing, Defendants violated, and unless restrained and
enjoined will continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and
Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].
SECOND CLAIM FOR RELIEF
Violations of Section 17(a) of the Securities Act
55. The Commission realleges and incorporates by reference paragraphs 1 through
51.
56. Defendants, by engaging in the conduct described above, directly or indirectly, in
the offer or sale of securities, by use of the means of instruments of transportation or

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communication in interstate commerce or by use of the mails:
a. with scienter, employed devices, schemes, or artifices to defraud;
b. obtained money or property by means of untrue statements of material
fact or by omitting to state a material fact necessary in order to make the
statements made, in light of the circumstances under which they were
made, not misleading; and
c. engaged in transactions, practices, or courses of business which operated
or would operate as a fraud or deceit upon purchasers.
57. By reason of the foregoing, Defendants violated, and unless restrained and
enjoined will continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)].
PRAYER FOR RELIEF
WHEREFORE, the Commission respectfully requests that the Court:
I.
Permanently enjoin Defendants from directly or indirectly violating Section 10(b) of the
Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 C.F.R. § 240.10b-5] thereunder, and
Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)].
II.
Permanently enjoin Defendants from directly or indirectly, including, but not limited to,
through any entity owned or controlled by them, participating in the issuance, purchase, offer, or
sale of any security; provided, however, that such injunctions shall not prevent Soberal or Olguin
from purchasing or selling securities for their own personal accounts.
II  I.
Issue an order barring Defendants from serving as an officer or director of any entity
having a class of securities registered with the Commission pursuant to Section 12 of the
Exchange Act [15 U.S.C. § 78l] or that is required to file reports pursuant to Section 15(d) of the
Exchange Act [15 U.S.C. § 78o(d)], pursuant to Section 20(e) of the Securities Act [15 U.S.C.
§ 77t(e)] and Section 21(d)(2) of the Exchange Act [15 U.S.C. § 78u(d)(2)].

COMPLAINT
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IV.
Issue an order requiring Defendants to disgorge all ill-gotten gains or unjust enrichment
derived from the activities set forth in this Complaint, together with prejudgment interest
thereon.
V.
Issue an order requiring Defendants to pay civil monetary penalties pursuant to Section
20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act [15
U.S.C. § 78u(d)(3)].
VI.
Retain jurisdiction of this action in accordance with the principles of equity and the
Federal Rules of Civil Procedure in order to implement and carry out the terms of all orders and
decrees that may be entered, or to entertain any suitable application or motion for additional
relief within the jurisdiction of this Court.
VII.
Grant such other and further relief as this Court may deem just and necessary.

Dated:  November 9, 2023 Respectfully submitted,

  /s/ Drew Liming
Drew Liming
Attorney for Plaintiff
SECURITIES AND EXCHANGE COMMISSION

COMPLAINT 
SEC V. SOBERAL, ET AL. 

  
 
  

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MONIQUE C. WINKLER (Cal. Bar No. 213031) 
[email protected] 

JASON H. LEE (Cal. Bar No. 253140) 
[email protected] 

RAHUL KOLHATKAR (Cal. Bar No. 261781) 
[email protected] 

MARC D. KATZ (Cal. Bar No. 189534) 
[email protected] 

DREW LIMING (Cal. Bar No. 305156) 
[email protected] 

 
Attorneys for Plaintiff  
SECURITIES AND EXCHANGE COMMISSION 
44 Montgomery Street, Suite 2800 
San Francisco, California  94104 
Telephone:  (415) 705-2500 
Facsimile:   (415) 705-2501 

SECURITIES AND EXCHANGE COMMISSION, 
 

Plaintiff, 
 

v. 
 
JAKE SOBERAL, and 
IRMA OLGUIN, JR.,  
 

Defendants. 

Case No. 
 
 
 
COMPLAINT 
 
JURY TRIAL DEMAND 
 

 

  
 

 

Plaintiff Securities and Exchange Commission (the “Commission” or “SEC”) alleges: 

SUMMARY OF THE ACTION 

1. In 2022, Defendants Jake Soberal and Irma Olguin, Jr. (together, “Defendants”) 

falsified documents and misled investors while raising approximately $70 million. Defendants 

were the co-founders and co-CEOs of Fresno-based Bitwise Industries, Inc. and its corporate 

 
UNITED STATES DISTRICT COURT 

 
EASTERN DISTRICT OF CALIFORNIA 

 
FRESNO DIVISION 

 

 

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parent, BW Industries, Inc. (together, “Bitwise”). Bitwise offered technology training, software 

development, and real estate management services.  

2. In connection with Bitwise’s Series B-2 securities offering in 2022, Defendants 

made false and misleading statements to investors, including inflating the company’s key 

financial metrics. To substantiate their false claims, Defendants also provided several investors 

with fabricated documents, including altered bank statements and a falsified audit report. 

Approximately 20 investors, including individuals, institutional investors, and venture funds, 

participated in Bitwise’s Series B-2 offering. 

3. Defendants represented to investors that Bitwise had significant revenue and 

maintained healthy cash balances. But the strong financial picture Defendants painted was, in 

fact, a sham. Soberal and Olguin knew that Bitwise had generated far less revenue than what 

they told investors. In addition, Soberal and Olguin told investors that Bitwise had substantial 

cash balances while concealing that the company regularly lacked cash and struggled to pay 

employees and other operational expenses. Defendants also lied to investors about an audit of 

Bitwise’s financial statements by an outside auditor and even provided an investor with a 

falsified document related to the audit. 

4. Defendants’ scheme unraveled in late May 2023, when Bitwise ran out of cash 

and could not pay its employees. Defendants then informed the company’s Board of Directors 

(the “Board”)—which included representatives of several large investors—of Bitwise’s true 

financial condition. The next day, all of Bitwise’s approximately 900-person workforce was 

indefinitely furloughed. Several days later, the Board terminated Defendants as co-CEOs.  

5. On June 28, 2023, the Board filed a petition for Chapter 7 bankruptcy in the 

United States District Court for the District of Delaware on behalf of Bitwise Industries, BW 

Industries, and several related entities. These entities are all currently in liquidation proceedings.  

6. As a result of the conduct alleged in this Complaint, Defendants violated the 

antifraud provisions of the federal securities laws. Specifically, Defendants violated Section 

10(b) of the Securities Exchange Act of 1934 (“Exchange Act”) [15 U.S.C. § 78j(b)] and Rule 

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10b-5 thereunder [17 C.F.R. § 240.10b-5], as well as Section 17(a) of the Securities Act of 1933 

(“Securities Act”) [15 U.S.C. § 77q(a)]. 

7. In this action, the Commission seeks permanent injunctions, disgorgement of ill-

gotten gains with prejudgment interest, and civil monetary penalties. The Commission also seeks 

an order (1) restraining and enjoining Defendants from directly or indirectly, including, but not 

limited to, through any entity owned or controlled by them, participating in the issuance, 

purchase, offer, or sale of any securities, provided however, that such injunction shall not 

prevent them from purchasing or selling securities for their own personal accounts; and (2) 

imposing officer and director bars. 

JURISDICTION AND VENUE 

8. The Commission brings this action pursuant to Sections 20(b), 20(d), and 22(a) of 

the Securities Act [15 U.S.C. §§ 77t(b), 77t(d), and 77v(a)] and Sections 21(d), 21(e), and 27 of 

the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa].  

9. This Court has jurisdiction over this action pursuant to Sections 20(b), 20(d)(1), 

and 22(a) of the Securities Act [15 U.S.C. §§ 77t(b), 77t(d)(1), and 77v(a)] and Sections 21(d), 

21(e), and 27 of the Exchange Act [15 U.S.C. §§ 78u(d), 78u(e), and 78aa]. 

10. Defendants, directly or indirectly, made use of the means and instruments of 

interstate commerce or of the mails in connection with the acts, transactions, practices, and 

courses of business alleged in this Complaint.  

11. Venue is proper in this District pursuant to Section 22(a) of the Securities Act [15 

U.S.C. § 77v(a)] and Section 27(a) of the Exchange Act [15 U.S.C. § 78aa(a)]. Acts, 

transactions, practices, and courses of business that form the basis for the violations alleged in 

this Complaint occurred in this District. Defendants met with and solicited prospective investors 

in this District, and offers and sales of securities took place in this District. 

12. Intradistrict assignment to the Fresno Division is proper pursuant to Rule 120(d) 

of the Court’s Local Rules because a substantial part of the acts and transactions constituting the 

violations alleged in this Complaint occurred in Fresno County, and Defendants reside in Fresno 

County. 

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DEFENDANTS  

13. Jake Soberal, age 37, is a resident of Fresno, California. Soberal co-founded 

Bitwise and was its co-Chief Executive Officer until June 2023. Soberal was admitted to the 

California State Bar in November 2011.  

14. Irma Olguin, Jr., age 42, is a resident of Caruthers, California. Olguin co-

founded Bitwise and was its co-Chief Executive Officer until June 2023. 

RELATED ENTITIES 

15. BW Industries, Inc. (“BWI”) is a Delaware corporation with its principal place 

of business in Fresno, California. It is the parent entity of Bitwise Industries. BWI and its 

securities are not registered with the Commission in any capacity. On June 28, 2023, BWI’s 

Board of Directors filed a petition for bankruptcy on behalf of BWI, Bitwise Industries, and 

several other BWI subsidiaries. These entities are currently in liquidation. 

16. Bitwise Industries, Inc. is a California corporation with its principal place of 

business in Fresno, California. It is a wholly-owned subsidiary and was the operating entity of 

BWI. Bitwise Industries and its securities are not registered with the Commission in any 

capacity.  

FACTUAL ALLEGATIONS  

I. Bitwise and its Business 

17. Soberal and Olguin co-founded Bitwise in 2013. Prior to co-founding Bitwise, 

Soberal worked as an intellectual property lawyer and Olguin founded several other start-ups. 

18. Bitwise had three core businesses: (1) a “Workforce” business focused on 

providing apprenticeship training for technology jobs; (2) an “Enterprise Solutions” business 

providing project-based systems implementation and software development; and (3) a 

“Community” business focused on developing and managing a commercial real estate portfolio. 

Its stated mission was to revitalize what it called “underdog cities” by supporting their 

development of technology industries.  

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19. Soberal and Olguin founded and headquartered Bitwise in Fresno. Before its 

collapse in 2023, Bitwise announced that it had expanded to other cities around the United 

States, including Bakersfield, Merced, Toledo, Buffalo, and El Paso.  

20. As co-CEOs, Defendants operated Bitwise together, and employees saw them as 

joint decisionmakers. In general, Soberal managed Bitwise’s real estate portfolio, while Olguin 

oversaw the technology consulting business. Both Soberal and Olguin were involved in 

Bitwise’s fundraising efforts. They both communicated with potential investors through phone 

calls, text messages, emails, video conferences, and in-person meetings. Defendants jointly 

discussed and agreed upon any significant decisions involving Bitwise’s fundraising. 

II. Defendants Raised Approximately $70 Million in 2022 

21. In 2022, Defendants knew that Bitwise needed additional funding to pay 

operating expenses. They decided to conduct a “Series B-2” offering that consisted of a mix of 

existing and new investors. Between June and December 2022 (the “Series B-2 Period”), Bitwise 

raised approximately $70 million from institutional, venture, and individual investors in its 

Series B-2 round. Some of the investors were social impact funds, which invest in companies 

that can both provide a positive financial return to the investor and benefit society or the 

environment. 

22. The Series B-2 investors invested in Bitwise in large part because Soberal and 

Olguin represented to them that Bitwise had a growing business, including significant revenue 

growth, gross margins over 40%, and large cash balances. Many of the investors were also 

interested in Bitwise’s purported ability to grow a profitable business while generating economic 

development in underserved communities.  

III. Defendants Solicited Investors Through False and Misleading Statements 

23. While raising money during the Series B-2 Period, Defendants made numerous 

false and misleading statements and provided falsified documents to investors because they 

knew the underlying facts would have revealed Bitwise’s poor financial condition. 

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A. Defendants Misrepresented Bitwise’s Revenue and Gross Margins 

24. In connection with the Series B-2 offering, Defendants prepared and provided 

investors with financial statements that stated that Bitwise had realized significant, consistent 

revenue growth. According to these financial statements, Bitwise had $59 million in annual 

revenue in 2021 and had increased its revenue in each successive quarter in 2021—from $8.4 

million in the first quarter to $21.6 million in the fourth quarter.  

25. The Stock Purchase Agreement for the Series B-2 offering, which was signed by 

Olguin on behalf of the company, represented that the financial statements provided to investors 

had been “prepared in accordance with generally accepted accounting principles (‘GAAP’) 

applied on a consistent basis[.]” It also represented that Bitwise “maintains a standard system of 

accounting established and administered in accordance with GAAP.” GAAP is important to 

investors because it provides rules for consistent accounting that allow investors to compare 

companies’ financials, including their revenue, with one another. 

26. Despite the representations to investors, Defendants knew, or were reckless in not 

knowing, that the financial statements they provided to investors were not prepared in 

accordance with GAAP. For example, shortly before the Series B-2 Period, employees in 

Bitwise’s finance department explained GAAP reporting to Defendants and informed them that 

the revenue numbers Defendants had been reporting externally were not compliant with GAAP. 

In addition, Defendants knew that in April 2022, Bitwise’s outside auditor had significantly 

reduced the company’s prior revenue numbers because the revenue that had previously been 

reported by Defendants was not compliant with GAAP.  

27. In spite of these warnings, Defendants continued to prepare and provide investors 

with non-GAAP revenue numbers throughout the Series B-2 Period. Defendants prepared 

Bitwise’s externally-reported financials themselves rather than rely on the company’s finance 

department. Defendants excluded Bitwise’s finance department from the financial reporting 

process because that gave them an opportunity to diverge from GAAP standards and inflate 

Bitwise’s revenue.  

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28. Defendants’ non-GAAP revenue numbers were higher than if they had been 

prepared using GAAP, because Defendants included financial line items that were impermissible 

under GAAP. For example, under GAAP’s accrual accounting rule, revenue for long term deals 

with customers is recognized only for the periods in which it is actually earned rather than all 

upfront. By contrast, Defendants counted the full value of deals as upfront revenue because that 

allowed them to inflate the revenue numbers. In addition, Defendants sometimes included 

proposed deals that lacked signed contracts as revenue, which is impermissible under GAAP’s 

rules. If Bitwise’s revenue had been prepared in accordance with GAAP, its 2021 annual revenue 

was less than $59 million and its 2021 quarterly revenue did not grow from $8.4 million to $21.6 

million. 

29. Defendants also provided investors with financial statements that falsely stated 

that Bitwise had gross margins of approximately 47% in 2021. Gross margins compare a 

company’s profits and costs to its revenue. Positive gross margins mean that a company 

generates profit with each dollar earned, while negative gross margins mean that a company 

loses money with each dollar earned. A gross margin of 47% meant that for every dollar Bitwise 

received as revenue, it generated 47 cents of profit and the remaining 53 cents were the cost of 

generating that dollar of revenue. Bitwise’s purported 47% gross margin misled investors into 

believing that its revenue exceeded its production costs and that it had a growing, financially 

stable business. 

30. Because Defendants had inflated Bitwise’s revenue by including financial line 

items that were impermissible under GAAP, Bitwise’s gross margins were consequently also 

inflated. Rather than having gross margins of approximately 47%, Bitwise had negative gross 

margins in 2021. In other words, instead of turning a profit, Bitwise was losing money and could 

continue operating only by relying on additional investor or other outside capital. 

31. Defendants’ misrepresentations regarding Bitwise’s revenue and gross margins 

were important to investors because they falsely painted the picture of a rapidly growing, 

financially sustainable company, which increased the likelihood that investors would obtain a 

favorable return on their investments. 

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B. Defendants Misrepresented Bitwise’s Cash Balances 

32. Throughout the Series B-2 Period, Defendants also made false and misleading 

statements to investors about Bitwise’s available cash. They regularly inflated Bitwise’s cash 

balances, which made it appear as if Bitwise had far more cash on hand than it actually did. For 

example, in connection with the Series B-2 offering, Defendants prepared and provided investors 

with financial statements that stated that Bitwise’s quarterly cash balances dating back to the first 

quarter of 2020 purportedly never fell below $9.4 million. These financial statements also 

represented that Bitwise had $29.4 million in cash as of the end of March 2022. And in a 

November 2022 presentation to the Board, Defendants represented that Bitwise then had over 

$67 million in cash. All of these reported cash balances were false.  

33. Defendants knew, or were reckless in not knowing, that the information about 

Bitwise’s cash balances they provided to investors was false and misleading because, before and 

throughout the Series B-2 Period, Bitwise faced repeated cash shortages and was unable to pay 

its regular operating expenses until it received additional funding. Following Bitwise’s collapse 

in May 2023, Defendants admitted to the Board that the cash balances they had provided to 

investors were misleading because Defendants had combined both cash and illiquid real estate 

and represented them collectively as “cash” in order to inflate the company’s cash balances. 

34. Defendants also faked documents to misrepresent Bitwise’s available cash to 

investors. For example, in June 2022, Olguin sent to an investor preparing a diligence 

memorandum for the Series B-2 offering a screenshot of a purported Bitwise checking account 

statement that showed a balance of $42.6 million as of December 31, 2021, and $23.4 million as 

of March 31, 2022. This screenshot was falsified. The relevant checking account had a balance 

of $11.7 million as of December 31, 2021, and only $325,100 as of March 31, 2022. Before 

Olguin sent the faked screenshot to the investor, Defendants discussed creating it and altering the 

underlying financial information, then jointly agreed to do so.  

35. Because Bitwise’s revenue was far lower than Defendants represented, the 

company was unable to generate sufficient money to pay employees and other basic operating 

expenses. Despite their representations to investors about Bitwise’s cash balances, Defendants 

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were aware of the company’s lack of cash because they both had access to Bitwise’s bank 

accounts and actively managed Bitwise’s payments. For example, throughout the Series B-2 

Period, Defendants regularly instructed lower-level employees to issue paper payroll checks 

instead of direct deposits, short-pay credit cards, and withhold payment to vendors while they 

sought additional sources of money. 

36. In summer 2022, Defendants took out a number of loans—including high-interest 

loans—to keep Bitwise financially afloat while they continued to solicit investor funds. 

Defendants did not disclose these loans to the Board or investors. These undisclosed loans meant 

that investor funds were used to repay loans and their accompanying fees rather than to operate 

and grow Bitwise, as Defendants had represented to investors. 

37. Defendants also personally profited from Bitwise’s cash struggles. They 

repeatedly made personal short-term loans to Bitwise that they signed on behalf of Bitwise as 

both borrower and guarantor. Defendants paid themselves a significant fee for these loans, which 

were for periods as short as a single day. For example, on April 4, 2023, Olguin loaned Bitwise 

$220,000. The following day, Bitwise wired her $247,000, thus providing her with proceeds of 

$27,000 for a one-day loan.  

38. The existence of these self-dealing loans was not disclosed to investors, and 

Defendants used money Bitwise raised in the Series B-2 offering to repay their loans and pay 

themselves the accompanying fees. For example, in September 2022, Soberal instructed an 

employee in the finance department to pay off his and Olguin’s loans when Bitwise received $5 

million from an investor. 

39. Defendants’ misrepresentations regarding Bitwise’s cash balances were 

significant to investors because they presented the company as financially healthy when it was 

struggling to pay bills, incurring increasing loan debt, and in financial distress. 

C. Defendants Misrepresented Bitwise’s Audited Financial Statements 

40. Prior to 2020, Bitwise did not have audited financial statements. In October 2020, 

Bitwise hired an outside auditor to audit its financial statements for its 2020 fiscal year. 

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41. The auditor issued its opinion in April 2022. The audited financial statements 

differed significantly from the financial statements Defendants had previously presented 

externally because the auditor could not find support for many of the assets or revenue 

Defendants claimed existed. For example, the audited financial statements reduced Bitwise’s 

total assets from $87 million to $42 million, reduced its revenue from $31 million to $9 million, 

and increased its net loss from $7 million to $26 million.  

42. During the Series B-2 Period, investors asked Defendants for Bitwise’s audited 

financial statements. Given the disparity between the audited financial statements and the 

financial statements Defendants had previously provided these investors, Defendants sought to 

withhold the audited financial statements from those who requested them. In July 2022—four 

months after the audit was complete and had been provided to Bitwise—Soberal and Olguin 

each falsely stated in response to direct questions from investors that the audit of the 2020 

financial statements was still underway and that they could not provide audited financial 

statements at the time.  

43. Defendants knew, or were reckless in not knowing, that the information they told 

investors regarding the audited financial statements was false and misleading. Their 

misrepresentations regarding the availability of Bitwise’s audited financial statements were 

important to investors because the audited financial statements would have revealed Bitwise’s 

true financial condition and made investors less likely to participate in the Series B-2 offering. 

44. Defendants also created a fake audited financial statement. In September 2022, 

one investor who had planned to make a $10 million investment reduced the size of its 

investment to $5 million based in part on the lack of audited financial statements. In December 

2022, Soberal and the investor discussed the possibility of it investing the additional $5 million it 

had earlier withheld. To solicit the additional $5 million from the investor, Soberal and Olguin 

jointly agreed to falsify the audited financial statements to significantly improve the appearance 

of Bitwise’s financial condition. Soberal then falsely told the investor that the audit had recently 

been completed and attached a document that he represented was the audited financial 

statements. 

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45. The document Soberal sent to the investor was fraudulent. Defendants dated the 

document December 1, 2022, while the real audited financial statements were dated April 7, 

2022. Defendants included financial statement line items in this fraudulent document that 

differed significantly from those in the real audited financial statements. Defendants inflated 

Bitwise’s total assets and revenue, while understating its net loss. Shortly after receiving the fake 

audited financial statements from Soberal, the investor made an additional $5 million investment 

in Bitwise’s Series B-2 offering. 

IV. Soberal and Olguin’s Scheme Fell Apart When They Were Unable to Continue 
Raising Money 

46. Despite Bitwise’s increasing financial problems, Soberal and Olguin continued to 

conceal the company’s true state. For example, in March 2023, Defendants represented to the 

company’s Board that, as of December 31, 2022, the company had over $77 million of cash on 

hand. 

47. Aware of Bitwise’s actual cash shortages, Defendants continued to seek sources 

of money to fund the company. In early 2023, Bitwise, under the direction of Soberal, took out 

over $20 million in loans secured by real estate that purportedly belonged to Bitwise. In 

connection with these loans, Soberal provided the lender with documents appearing to show that 

Bitwise’s Board had approved the transactions. Defendants forged the Board’s signatures on 

these documents, and the Board was not informed about these loans.  

48. On May 28, 2023, Defendants alerted Bitwise’s Board about the company’s 

financial distress and that it lacked the ability to make payroll. At an emergency meeting the 

following day, Defendants were unable to explain to the Board what had happened with the 

investor money Bitwise had raised, and, for the first time, disclosed that the company owed over 

$20 million in private loans.  

49. On May 29, 2023, Soberal and Olguin held a video conference for Bitwise’s 

entire workforce. On that video conference, they read a prepared statement informing Bitwise’s 

personnel that they were all immediately furloughed and that their previously issued paychecks 

might bounce.  

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50. On June 3, 2023, the Bitwise Board announced that it had terminated Soberal and 

Olguin and that one of the Board members would serve as interim CEO. 

51. On June 28, 2023, the Board filed a petition for Chapter 7 bankruptcy in the 

United State District Court for the District of Delaware on behalf of BWI, Bitwise Industries, 

and several related entities. These entities are all currently in liquidation proceedings. 

FIRST CLAIM FOR RELIEF 

Violations of Section 10(b) of the Exchange Act and Rule 10b-5 

52. The Commission realleges and incorporates by reference paragraphs 1 through 

51. 

53. Defendants, by engaging in the conduct described above, directly or indirectly, in 

connection with the purchase or sale of securities, by use of means or instrumentalities of 

interstate commerce, or of the mails, with scienter:  

a. Employed devices, schemes, or artifices to defraud;  

b. Made untrue statements of material facts or omitted to state material facts 

necessary in order to make the statements made, in the light of the 

circumstances under which they were made, not misleading; and  

c. Engaged in acts, practices, or courses of business which operated or 

would operate as a fraud or deceit upon other persons, including 

purchasers of securities.  

54. By reason of the foregoing, Defendants violated, and unless restrained and 

enjoined will continue to violate, Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)] and 

Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].  

SECOND CLAIM FOR RELIEF 

Violations of Section 17(a) of the Securities Act 

55. The Commission realleges and incorporates by reference paragraphs 1 through 

51.  

56. Defendants, by engaging in the conduct described above, directly or indirectly, in 

the offer or sale of securities, by use of the means of instruments of transportation or 

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communication in interstate commerce or by use of the mails:  

a. with scienter, employed devices, schemes, or artifices to defraud; 

b. obtained money or property by means of untrue statements of material 

fact or by omitting to state a material fact necessary in order to make the 

statements made, in light of the circumstances under which they were 

made, not misleading; and  

c. engaged in transactions, practices, or courses of business which operated 

or would operate as a fraud or deceit upon purchasers.  

57. By reason of the foregoing, Defendants violated, and unless restrained and 

enjoined will continue to violate, Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]. 

PRAYER FOR RELIEF 

WHEREFORE, the Commission respectfully requests that the Court: 

I. 

Permanently enjoin Defendants from directly or indirectly violating Section 10(b) of the 

Exchange Act [15 U.S.C. § 78j(b)] and Rule 10b-5 [17 C.F.R. § 240.10b-5] thereunder, and 

Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)]. 

II. 

Permanently enjoin Defendants from directly or indirectly, including, but not limited to, 

through any entity owned or controlled by them, participating in the issuance, purchase, offer, or 

sale of any security; provided, however, that such injunctions shall not prevent Soberal or Olguin 

from purchasing or selling securities for their own personal accounts. 

III. 

Issue an order barring Defendants from serving as an officer or director of any entity 

having a class of securities registered with the Commission pursuant to Section 12 of the 

Exchange Act [15 U.S.C. § 78l] or that is required to file reports pursuant to Section 15(d) of the 

Exchange Act [15 U.S.C. § 78o(d)], pursuant to Section 20(e) of the Securities Act [15 U.S.C. 

§ 77t(e)] and Section 21(d)(2) of the Exchange Act [15 U.S.C. § 78u(d)(2)]. 

Case 1:23-cv-01585-BAM   Document 1   Filed 11/09/23   Page 13 of 14



 

COMPLAINT 
SEC V. SOBERAL, ET AL. 

  
 
  

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IV. 

Issue an order requiring Defendants to disgorge all ill-gotten gains or unjust enrichment 

derived from the activities set forth in this Complaint, together with prejudgment interest 

thereon. 

V. 

Issue an order requiring Defendants to pay civil monetary penalties pursuant to Section 

20(d) of the Securities Act [15 U.S.C. § 77t(d)] and Section 21(d) of the Exchange Act [15 

U.S.C. § 78u(d)(3)]. 

VI. 

Retain jurisdiction of this action in accordance with the principles of equity and the 

Federal Rules of Civil Procedure in order to implement and carry out the terms of all orders and 

decrees that may be entered, or to entertain any suitable application or motion for additional 

relief within the jurisdiction of this Court. 

VII. 

Grant such other and further relief as this Court may deem just and necessary. 

 

 

Dated:  November 9, 2023 Respectfully submitted, 
  

  /s/ Drew Liming    
Drew Liming 
Attorney for Plaintiff  
SECURITIES AND EXCHANGE COMMISSION 

 

Case 1:23-cv-01585-BAM   Document 1   Filed 11/09/23   Page 14 of 14


	Summary of the Action
	Jurisdiction and Venue
	Defendants
	RELATED ENTITIES
	Factual Allegations
	I. Bitwise and its Business
	II. Defendants Raised Approximately $70 Million in 2022
	III. Defendants Solicited Investors Through False and Misleading Statements
	A. Defendants Misrepresented Bitwise’s Revenue and Gross Margins
	B. Defendants Misrepresented Bitwise’s Cash Balances
	C. Defendants Misrepresented Bitwise’s Audited Financial Statements
	IV. Soberal and Olguin’s Scheme Fell Apart When They Were Unable to Continue Raising Money

	FIRST CLAIM FOR RELIEF
	SECOND CLAIM FOR RELIEF
	PRAYER FOR RELIEF