By Trevor Bach
Dallas Morning News
https://www.dallasnews.com/
Regulators say the digital coin operator’s conduct “threatens immediate and irreparable harm to the public.”
Financial regulators in Texas have issued an emergency cease and desist order to a McKinney-based cryptocurrency and its operator, asserting the venture was perpetrating fraud through an unregistered investment scheme.
The Texas State Securities Board filed the order last week against ‘TEXITcoin’ and the digital coin’s creator, McKinney resident Robert Gray; additionally, the state agency named two more affiliated ventures, MineTXC and Blockchain Mint, in its emergency order.
MineTXC serves as the cryptocurrency’s digital mining operation, while Blockchain Mint serves as the venture’s marketing arm and also manufactures cold storage coins, or the physical coins that crypto owners can use to access their digital holdings. All the entities are controlled by Gray, according to the order.
The order largely relates to Gray’s promotion and sale of passive crypto mining investments that were dubbed “Mining Packages.” They were promoted through multi-level marketing, the controversial business model where sales agents sell products to consumers and earn commissions by recruiting new sellers.
Gray and the affiliated operators “are engaging in illegal, fraudulent, deceptive, and/or misleading practices in connection with the offer of the Mining Packages to Texas residents,” the order said.
“Their conduct threatens immediate and irreparable harm to the public.”
“In cases like this, when investor harm is immediate and ongoing, it’s imperative we act quickly,” Deputy Securities Commissioner Cristi Ramón-Ochoa said in a statement.
“Our work is expanding and becoming more and more complex as we have to keep up with the introduction and exposure of new products — especially in the crypto space and with the growth of social media platforms being used to solicit investors,” Ramón-Ochoa said in an email to The Dallas Morning News.
Gray did not respond to a voicemail request for comment from The News on Wednesday, and an email sent to an address listed for TEXITcoin bounced back.
Following the order, the price of TEXITcoin, which last fall hit a high above $6, dropped considerably. The crypto was trading above $0.70 early last week, then quickly fell to below $0.30, where it was still trading late this week.
The state’s cease-and-desist also comes amid a new broad crypto downturn: This week, the price of Bitcoin has hovered below $70,000, falling from a record high above $126,000 in October amid heightened volatility in risk-sensitive assets.
Last year, the asset class also surged in public prominence — including in Texas, a state that lobbyists and politicians have pushed to transform into a global epicenter for the industry.
Yet crypto more broadly also remains dogged by concerns related to energy consumption and fraud, with the Texas State Securities Board recently warning that crypto and crypto investing have become “the basis for a new raft of scams.”
State law enforcement officials have also issued warnings about various crypto-related scams.
‘No longer accepting new miners’
The McKinney entrepreneur does appear to have adjusted his practices in response to the state’s order.
This week, visitors to the website for MineTXC are greeted with a pop-up message referencing the cease and desist and informing them the site “is no longer accepting new miners or the acquisition of additional hash power by existing miners.”
The note was framed as a celebratory graduation message, and ended with a sign off from “Bobby” thanking visitors for “98 Weeks of fun, profit & friendship.”
A running tally at the top of the site claimed the operation has drawn nearly 59,000 paying miners, raised $148 million and paid out $65 million in commissions.
Additional graphics on the site indicate the operation added five more miners as recently as Feb. 11, the day the state sent its cease-and-desist, and that miners have continued to receive rewards.
Next to a trophy graphic, it also has tallies of “top recruiters,” showing “Josh S.” in 1st place, with 408 referrals. Another list of “top earners” showed five names had earned over $200,000 in rewards.
The websites for TEXITcoin and Blockchain Mint did not appear to reflect any updates, although TEXITcoin’s site said a new website is coming soon. The Blockchain Mint site still appeared to be selling cold storage products.
All three sites failed to register with the Texas Secretary of State, according to the cease-and-desist, and are not “authorized to transact business in the state of Texas.”
State regulators also homed in on the operation’s particular marketing practices: To sell customers on the digital mining venture, Gray’s entities claimed that once investors bought a package, they had their “seat on the rocket ship, and now can simply sit back and enjoy the ride.”
The venture’s sales agents used YouTube, Facebook, X and other social media — as well as radio and billboard ads — to offer the packages, which included plans costing $995, $2,985 and $8,955. The business also included a detailed commission structure and bonus program to incentivize sellers to recruit new sellers, who could be paid in different forms of crypto, or eventually cash.
But the packages, as unregistered securities, were not permitted to be sold in Texas, regulators say.
The operation also failed to disclose a variety of necessary financial information, including the qualifications of MineTXC’s managers and asset and liability information for another entity, “Danager Resources,” that was listed as the mail recipient for investors who wanted to pay by check.
While touting Gray’s experience, the operation was also “intentionally failing to disclose” that an earlier alternative coin company founded by Gray, called Mulligan Mint, filed for bankruptcy and shut down in 2021, the order said.
Big crypto ambitions
Gray, a high-profile crypto personality, has recently described the relatively new TEXITcoin as an original, Texas-specific coin that will be mined for multiple generations.
“In fact, the thing that makes it different from everything else that you’ll come across in this room, on this floor, in this building or in the entire cryptocurrency space,” he said during a speech last year at a crypto event in Singapore, “is that TEXITcoin is the only coin that has a regional limitation on where it can be mined.”
Gray was wearing a bright blue cowboy hat, and quickly pivoted to acknowledge some of the ongoing concerns around crypto.
“I only have a few minutes up here on stage to convince you guys that TEXITcoin is not a scam, like so many of the other things that pop up in the cryptocurrency industry,” he said.
“And it’s going to be very difficult to do that in the next few minutes. I’m going to have to convince you that it’s not a meme coin, it’s not a pump and dump, it’s not a rug pull, it’s not a Ponzi scheme and it’s not a pyramid scheme.”
“It’s a lot of work,” he continued, “and unfortunately, I don’t have time to do that here today.”
Gray then encouraged attendees to visit the coin’s booth and talked up the venture’s capital raise and promotional campaign, mentioning billboards, airport ads — including at DFW — and “wrapped hypercars cruising the streets of Dallas.”
In an interview with The News last year, the TEXITcoin founder, who has a background in gold and silver coin manufacturing, also recounted a story he’s repeated often. In 2012, he said, he created “what has probably become the most famous coin in the world today, which is the original Bitcoin coin” — a copper-colored physical representation of the famous digital currency.
“Yeah, I own the copyright for that. It’s been widely counterfeited, so unfortunately it hasn’t made me a lot of money,” he said.
By Trevor Bach
Trevor Bach joined The Dallas Morning News in 2025 and reports on a wide range of business and economic topics. He previously worked for The Real Deal in Los Angeles and Miami New Times, and his freelance writing has appeared in numerous publications.
This story, originally published in The Dallas Morning News, is reprinted as part of a collaborative partnership between The Dallas Morning News and Texas Metro News. The partnership seeks to boost coverage of Dallas’ communities of color, particularly in southern Dallas.
