Monday, March 11, 2019

OneCoin's demise🔥

March 11, 2019

OneCoin's Demise: The Fall of a $3.7 Billion Pyramid Scheme

Since 2016, authorities from around the world have warned investors of fraud from the crypto project OneCoin - a multi-level pyramid marketing scheme based in Bulgaria.

Now, a "top leader" at the project has been arrested at Los Angeles International Airport and charged with wire fraud that could land him up to 20 years behind bars if convicted.

The biggest ever?

The arrest is a big win that will help lead to co-conspirators who defrauded investors of more than an alleged $4 billion from victims - making it one of the largest crypto scams in history.

In crypto's short history, a number of projects have successfully scammed investors. The top 5, ranked by estimated amount stolen, are:

OneCoin
Pincoin and iFan
Bitconnect
Centratech
Plexcoin

Perhaps the worst aspect of OneCoin was that the scheme didn't even operate with a legitimate blockchain. The dream it sold was loosely pulled together, but still managed to attract innocent funds.

Growing pains

As the industry grew from 2016 to 2019, it inevitably invited some suspicious characters to the space.

In 2018, an estimated $1.7 billion or rather, $4.6 million per day was lost via illicit means, according to analytics firm CipherTrace.

While the growing trend is not expected to continue as the space matures and meets stronger regulation, it's an important reminder that investors must still be hyper-protective of their assets at this point.

REGULATION

Texas Wants You to Tell Them When You Use Cryptocurrency

A new bill in Texas is set out to make identity verification required when using cryptocurrencies.

Proposed by Republican state representative Phil Stephenson, people receiving cryptocurrencies in a transaction would first have to "verify the identity of the person sending payment."

Exempt if…

This rule would be exempt "if the payment is sent by a verified identity digital currency."

Though the bill doesn't explain what a "verified identity digital currency" is, we can safely assume that private cryptocurrencies are not included in this. Monero (XMR) and ZCash (ZEC) users - that means you.

On the bright side, the bill notes that a number of state agencies will invest resources into spreading awareness and the use of "verified identity digital currencies."

EXCHANGE

BTCP is Calling Fraud After HitBTC Delisting

Announced over the weekend, Bitcoin Private has sent a legal letter to popular crypto exchange HitBTC after a series of events that resulted in the loss of 58,920 BTCP.

In the letter, the BTCP team claims that HitBTC charged a "$500,000 listing fee" back in May 2018. The fee made BTCP available to investors for trading purposes.

Then, in December 2018, CoinMetrics uncovered an additional 2 million BTCP coins in circulation. To deal with the issue, the development team scheduled a "burn" to delete the extra, unwanted coins.

No help and unprepared

When the coin burn finally happened, HitBTC claimed it was unprepared even after reaching out to BTCP developers for help.

In total, 58,920 BTCP was burned in HitBTC wallets that was supposed to be safeguarded during the event.

Subsequently, HitBTC delisted the coin and has since defended its position against BTCP.

BITS

But wait, there's more...

🇨🇭 Swiss stock exchange SIX is looking to list an XRP-traded product on its platform.
🚀 A blockchain-related ETF is launching on the London Stock Exchange today.
🤓 "Crypto mom" Hester Peirce has argued that crypto markets should self-regulate whenever possible.

MEME