$3 Billion Chinese Ponzi Scheme Dumping BTC on Major Exchanges

The scheme defrauded around 10,000 investors.

The selling pressure created in the crypto market in recent days might have been triggered by the dumping of hundreds of Bitcoin on exchanges by Chinese crypto Ponzi scheme Plus Token.

Pointed out by Dovey Wan, founding partner of blockchain-based investment company Primitive Ventures, on August 14, wallets related to the scheme have been active and transferred funds to major exchanges like Huobi, Bitrex, and Binance.

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Launched in mid-May 2018, PlusToken assured six to 18 percent monthly interest on deposited cryptocurrencies and similar to a classic Ponzi scheme, it showcased four-tire memberships.

By early 2019, the project claimed that it received funds from ten million investors. According to Wan, the project gathered around $3 billion in funds.

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Funds still in control of perpetrators

Though the team members of the Ponzi scheme were already arrested two months ago by the Chinese police, the wallet addresses were not confiscated by the authorities due to their P2SH structure.

Wan publicly revealed multiple wallet addresses related to the scheme and even published evidence of the flow of funds from them to major digital asset exchanges, which she gathered from the security audit firm Peckshield.

She also pointed out that the perpetrators are transferring funds in small batches of 50-100 BTC at a time to avoid raising suspicions. Meanwhile, Wan requested blockchain research firms like Peckshield and Chainalysis to monitor the wallet address related to the scheme.

Plus Token is not the only multi-billion crypto Ponzi scheme. The notorious promoters of OneCoin duped investors across the world for around $4 billion. Although the authorities of multiple countries are trying to capture the people associated with the scheme, the fraudsters are still victimizing people in many regions.

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