HEX dropped almost 60%, PulseX declined 49%, and PulseChain’s PLS token slid nearly 36% following reports that Richard Heart had been detained in Istanbul under an Interpol Red Notice requested by Finland. The steep declines underscore how legal uncertainty surrounding a high-profile founder can quickly undermine confidence in a crypto ecosystem built around a prominent public figure.
Turkish police, working with the National Intelligence Organization (MİT), reportedly detained Heart, whose legal name is Richard James Schueler, in Istanbul’s Beşiktaş district. The operation was reportedly linked to a Red Notice requested by Finland in December 2024 over suspected aggravated tax fraud. However, a reported detention does not establish guilt, amount to a conviction, or confirm that extradition will take place.
The Finnish investigation reportedly focuses on suspected tax fraud involving income generated between June 2020 and April 2024. Authorities have reportedly estimated the potential unpaid taxes at hundreds of millions of euros. Reporting about Heart’s wanted status has also referenced a separate assault allegation involving a 16-year-old.
According to reports, authorities recovered items during the Istanbul operation that included approximately $4 million in cash, electronic devices, firearms, drones, 64 watches, and six cold wallets.
Richard Heart’s Legal Troubles Trigger a Sell-Off Across His Crypto Projects
Heart established HEX, PulseChain, and PulseX, and his public persona has played a major role in promoting the ecosystem. That close association can expose the projects to significant founder-related risk, as legal developments involving a central figure may influence investor perceptions of leadership, transparency, and future development.
The sharp declines do not necessarily indicate that the underlying blockchain infrastructure has malfunctioned. Instead, they may reflect uncertainty about the founder’s ability to communicate with the community and remain involved in the projects.
Market conditions can also intensify the reaction. Tokens with limited liquidity may experience outsized price swings when traders rush to sell, while widening spreads and forced liquidations can accelerate losses.
Such movements can push prices well beyond what the initial news alone might suggest. Nevertheless, falling token prices do not independently establish that a project’s technical foundations or long-term prospects have changed.
The reported seizure of Heart’s personal property also does not automatically mean that PulseChain has stopped operating or that HEX, PLS, or PLSX smart contracts have become invalid.
The more immediate concerns involve operational continuity. Investors may seek clarity on whether the projects can maintain development and communication without Heart’s direct involvement, whether independent teams are equipped to manage operations, and whether any of the reported wallets have a connection to project-controlled funds.
Separate Legal Proceedings Add to Investor Uncertainty
Heart’s legal issues in the United States are distinct from Finland’s investigation.
In 2023, the U.S. Securities and Exchange Commission filed a civil complaint alleging that Heart and associated projects conducted unregistered securities offerings exceeding $1 billion and that at least $12 million was misused. A federal judge dismissed the case in February 2025 on jurisdictional grounds, and the SEC did not proceed with an amended complaint.
These allegations and proceedings should be distinguished from the Finnish investigation. Neither the reported detention nor the existence of legal allegations alone establishes criminal guilt.
For investors, the immediate question is how further verified legal developments might affect the projects’ leadership, public communication, and ability to operate independently. Any disruption could influence sentiment toward HEX, PLS, and PLSX, particularly while traders remain sensitive to uncertainty surrounding Heart.
An official Turkish court filing or a confirmed extradition proceeding would help clarify the next stage of the legal process. Until such developments are verified, the possibility of further volatility remains, but the eventual legal outcome and future direction of the tokens are uncertain.
