{"investigation":{"slug":"quantum-blocks-capital-lp","entity_name":"Quantum Blocks Capital, LP","trust_score":10,"severity_base":null,"score_modifier":0,"confidence":0.5,"status":"published","content_type":"investigation","summary":"Quantum Blocks Capital, LP (QBC) is a cryptocurrency investment fund that is the subject of a proposed nationwide class action filed in New Hanover County Superior Court, North Carolina, alleging it lost or diverted nearly $60 million in investor assets. The suit alleges fund managers gave one manager, Clive Smith, largely unsupervised control over an automated Bitcoin trading program called 'Logic,' that distributions stopped in January 2026, and that fund counsel later disclosed Smith had been stripped of authority and was under FBI investigation. As of the most recent reporting, these remain allegations in a civil complaint; QBC has acknowledged in a statement that the complaint alleges Smith misappropriated investor funds but disputes being the source of the loss itself.","sections":[{"content":"A proposed nationwide class action filed June 19, 2026 in New Hanover County Superior Court, North Carolina, alleges that Quantum Blocks Capital, LP (QBC) and its management lost or diverted nearly $60 million in investor assets. The complaint alleges QBC marketed itself as a 'professionally managed' crypto fund but in practice gave one manager, Clive Smith, 'inadequately supervised' control over millions of dollars, with no board oversight or dual-authorization controls on fund transfers. According to the complaint, managers Jason A. Williams and Domenico Grillo personally solicited investors with promises of semi-annual returns of 10% to 20%, said to be generated by an AI-driven Bitcoin trading program called 'Logic' and diversified real-estate holdings. The suit alleges investor funds were routed through the exchanges Kraken and Binance to Smith. These are allegations made in a civil complaint and have not been adjudicated by a court.","heading":"Lawsuit: Alleged $60 Million Loss and Unsupervised Manager","sources":[{"url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","name":"Wilmington businessman leads lawsuit over alleged $60M crypto fraud - WECT","type":"news_article","credibility":2}],"severity":"critical"},{"content":"The lead plaintiffs are Wilmington, North Carolina businessman Caleb Hobbs and Wilmington-based Hobbs Electric LLC. According to the complaint, they personally invested at least $2.45 million in USDC in the fund between December 2024 and September 2025. The suit seeks class-action certification on behalf of other QBC investors, compensatory and punitive damages, an asset freeze, and a full accounting of remaining fund assets. As a proposed class action, certification has not been granted as of the most recent available reporting.","heading":"Plaintiffs and Alleged Investments","sources":[{"url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","name":"Wilmington businessman leads lawsuit over alleged $60M crypto fraud - WECT","type":"news_article","credibility":2}],"severity":"high"},{"content":"The complaint alleges that the fund's structure began to unravel in January 2026, when scheduled distributions to investors failed to be made. According to the suit, QBC managers initially attributed the delay to a routine know-your-customer verification issue with Binance, and claimed to have been in contact with Binance founder Changpeng Zhao. The complaint alleges that in April 2026, QBC's legal counsel disclosed to investors that manager Clive Smith had been stripped of his authority and was under investigation by the FBI. The complaint further alleges that on May 13, 2026, QBC formally demanded that Smith repay $59,966,213.09. QBC has reportedly frozen all redemptions, withdrawals, and new subscriptions, and the lawsuit alleges investors remain unsure how much of their money, if any, remains. None of these allegations regarding Smith's conduct or the FBI investigation have been independently confirmed by law enforcement statements or additional reporting found.","heading":"Halted Distributions and Internal Disclosure About Clive Smith","sources":[{"url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","name":"Wilmington businessman leads lawsuit over alleged $60M crypto fraud - WECT","type":"news_article","credibility":2}],"severity":"critical"},{"content":"Quantum Blocks Capital issued a statement reported by WECT acknowledging that 'the complaint alleges that Mr. Smith misappropriated investor funds.' The statement said that managers Domenico Grillo, Jason A. Williams, and a third individual referred to as Devanzante are working to recover money for investors. No response attributed directly to Clive Smith, Williams, Grillo, Binance, or Kraken was found. No regulatory action (SEC, CFTC, or state securities regulator) or criminal charges against any individual associated with QBC were identified in available sources as of this writing.","heading":"Company Response","sources":[{"url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","name":"Wilmington businessman leads lawsuit over alleged $60M crypto fraud - WECT","type":"news_article","credibility":2}],"severity":"medium"},{"content":"As of this writing, the sole identified public source for these allegations is a single local news report (WECT, a Wilmington, North Carolina television station) summarizing the civil complaint. No independent court-record confirmation (e.g., a docket entry, case number, or the complaint text itself), SEC/CFTC filing, FBI statement, or additional media coverage corroborating the $60 million figure, the FBI investigation, or the identities of 'Logic' and the individuals involved was found through web search. This is a developing matter involving unproven civil allegations, and the overall confidence of this page is accordingly limited.","heading":"Sourcing Limitations","sources":[{"url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","name":"Wilmington businessman leads lawsuit over alleged $60M crypto fraud - WECT","type":"news_article","credibility":2}],"severity":"low"}],"timeline":[{"date":"2024-12","event":"Alleged start of plaintiff Caleb Hobbs' and Hobbs Electric LLC's investments in Quantum Blocks Capital, via USDC.","source":"WECT","source_url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/"},{"date":"2025-09","event":"Alleged end of the plaintiffs' investment period in the fund, totaling at least $2.45 million in USDC.","source":"WECT","source_url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/"},{"date":"2026-01","event":"Scheduled investor distributions allegedly stopped; managers reportedly cited a Binance verification delay.","source":"WECT","source_url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/"},{"date":"2026-04","event":"QBC's legal counsel allegedly disclosed to investors that manager Clive Smith had been stripped of authority and was under FBI investigation.","source":"WECT","source_url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/"},{"date":"2026-05-13","event":"QBC formally demanded that Clive Smith repay $59,966,213.09, according to the complaint.","source":"WECT","source_url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","date_evidence":"On May 13, QBC formally demanded that Smith repay $59,966,213.09,"},{"date":"2026-06-19","event":"Caleb Hobbs and Hobbs Electric LLC filed a proposed nationwide class action against Quantum Blocks Capital, LP and its managers in New Hanover County Superior Court, North Carolina.","source":"WECT","source_url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","date_evidence":"The lawsuit, filed June 19 in New Hanover County Superior Court,"},{"date":"2026-09-01","event":"WECT published the first identified report on the lawsuit and its allegations.","source":"WECT","source_url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","date_evidence":"Published: Sep. 1, 2026 at 11:27 AM EDT"}],"sources_used":[{"url":"https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","name":"Wilmington businessman leads lawsuit over alleged $60M crypto fraud - WECT","type":"news_article","archive_url":"http://web.archive.org/web/20261023202755/https://www.wect.com/2026/09/01/wilmington-businessman-leads-lawsuit-over-alleged-60m-crypto-fraud/","credibility":2,"archive_timestamp":"2026-10-23T20:27:55+00:00"}],"source_tags":[],"addresses":[],"reviewed":false,"reviewed_by":null,"model_used":"claude-code-investigator","created_at":"2026-10-23T20:13:03.99882+00:00","updated_at":"2026-10-24T00:59:22.258661+00:00"},"source_quality":{"total":1,"tier1":0,"tier2":0,"tier3":0,"unrated":1},"follower_count":null,"content_updated_at":"2026-10-23T20:13:04.476Z","last_fact_checked_at":null,"fact_check_next_allowed_at":null,"update_next_allowed_at":null}