Richard Heart

Richard Heart, born Richard Schueler, built a cryptocurrency empire on audacity. His flagship project, HEX, launched in 2019 and was marketed as the first blockchain certificate of deposit -- a token that would reward holders for locking up their stakes. Heart promoted it incessantly, claiming it was the best-performing asset in the history of finance. He then launched PulseChain, a fork of Ethereum, and PulseX, a decentralized exchange, raising funds through what he called a "sacrifice phase" where participants sent cryptocurrency with no contractual guarantee of receiving anything in return.

The sacrifice framing was a masterpiece of regulatory arbitration. By telling participants they were making a political statement rather than an investment, Heart attempted to sidestep the securities laws that would have required registration, disclosure, and accountability. Despite the disclaimers, the implicit promise was clear: sacrifice now, receive tokens later, and those tokens will be worth far more than what you put in. Hundreds of millions of dollars flowed in. The SEC alleged the total raised across all three projects exceeded one billion dollars.

What Heart did with those funds drew particular scrutiny. According to the SEC's complaint, he used investor money to fund an extraordinary lifestyle, including purchasing a 555.55-carat black diamond -- reportedly the largest cut diamond in the world -- and acquiring a collection of luxury watches and automobiles. While followers promoted HEX with near-religious devotion, Heart was converting their contributions into personal assets. The SEC filed its complaint in July 2023, alleging unregistered securities offerings and misappropriation of investor funds.

Heart's response was to largely ignore the legal proceedings while continuing to promote his projects from undisclosed locations. Finnish authorities also opened a tax evasion investigation. Meanwhile, the value of HEX, PulseChain, and PulseX tokens declined dramatically from their peaks, leaving many participants with holdings worth a fraction of their original sacrifice. The saga of Richard Heart illustrated how charisma and aggressive marketing could attract enormous sums of money in an industry where the line between innovation and fraud was often drawn only after the damage was done.