Aside the $3 bln PlusToken, Beware of These Possible Chinese Crypto Scams
The crypto space has recently been in an uproar over the PlusToken scam which made off with a whopping $3 billion fraudulent fund. That would make it the biggest crypto Ponzi scheme to date.
Almost at the same time when PlusToken went bust in early July, another Chinese Ponzi scheme that went under a Tron-like name has reportedly led to $30 million worth of losses and one suicide.
As cryptocurrencies gain popularity and its underpinning technology blockchain grows, crooks are taking advantage of the nascent and trendy concepts to scam innocents. Aside from these two latest Ponzi schemes busted in the country, 8btc found that there’re still dozens of similar MLM/pyramid schemes scamming crypto investors, including CloudToken, MGCToken, WoToken, MAX token, BossToken, VDS and similar “resonance pattern” tokens.
CloudToken, similar scale of PlusToken, bills itself as the world’s first social wealth wallet to integrate all blockchain cryptoassets into one platform.
Started in January this year, CloudToken adopts a 21-level compensation plan to reward its investors – once you have your signups achieving ranks, you’ll get paid bonus amounts. It promises 10%-15% ROI (return on investment), and investors have to maintain a minimum $500 worth of the token at all times to have that profit. Apart from high returns and MLM scheme, the team members are faked.
Based in China, the project is actively promoted in Asian countries like Japan, Indonesia, Malaysia, etc; it is even targeting African countries.
CloudToken (CTO) is actually useless and cannot be traded on external exchanges. It may ends in another painful exit scam shortly after once they fail to pay the ROI they offer.
MGC Token, another PlusToken-like crypto wallet scam, claims itself as a decentralized wallet.
According to the site, MGC Token is a project developed by Aone team of London financial center, featured by functions including decentralized digital asset wallet + decentralized digital asset trading platform + ATS intelligent financial management system + global payment system.
Promised a monthly profit at 9%-25% generated from its intelligent arbitrage trading bot, investors can also get reward by pulling more people in – typical characteristics of a MLM program.
In order to buy WoToken, investors are required to download the WO Token Dapp, and then trade Bitcoin (BTC), Ethereum (ETH), Ethereum Classic (ETC) or Litecoin (LTC) into WOR tokens.
According to its introduction, WoToken wallet claims to be a wallet to bridge the digital currency and the physical world, in which the Apollo intelligent robot can help obtain income (6%-20%) via high-frequency quantitative trading.
To make it legitimate, the company says it will issue digital currency cards in collaboration with banks and card issuers like Visa and Master. It even goes as far as to link sites like SBI Holdings, BTC.com, Forbes, Bitcoin.com and MyToken, but these links only go to the sites rather than actual reports.
VDS and similar “resonance pattern” tokens
Apart from various wallet projects, many controversial “resonance pattern” tokens represented by VDS are also popular in the country.
In February this year, a “resonance” project named VDS was revealed. In just two months, it created a myth of sudden wealth with the token price surging nearly 100 times. This attracts many speculators into the game and makes “resonance pattern” a buzz in the crypto sphere.
Resonance pattern refers to a double wallet design – once the user registers a wallet, a VDS wallet would be sync-generated. Then a user can trade Bitcoin in the first wallet into VDS token, but not vice versa. The amount of VDS they can obtain is determined by the resonance V pool (market demand).
Seeing VDS in high demand, many tokens in such a pattern appear, with most mainstream cryptos “resonated”. FDS resonates BNB, HDS resonates HT, ODS resonates OKB, UPE resonates ETH, VBT resonates USDT, LDS resonates LTC, etc.
These tokens are actually useless and cannot be traded on exchanges or traded back into mainstream cryptocoins. It is apparently another quick cash grab with some fancy concepts.
Still, many investors fall into these scams, believing they can make some profit from it and time their exit.