Shanghai Police Bust $16M Crypto Pyramid Scheme

Police successful Shanghai arrested much than 10 radical successful transportation with an astir $16 cardinal pyramid strategy that progressive cryptocurrencies, the archetypal to beryllium solved successful the city.

• The Shanghai constabulary bureau had conducted an probe for implicit six months crossed antithetic provinces to way down the transgression ring, according to a post connected the bureau's authoritative WeChat account.

• The suspected criminals acceptable up an online level successful June 2020 that attracted users done rank rewards and the committedness of static income, the constabulary said.

• Users were asked to speech their fiat currency for level tokens to summation membership, but the tokens had nary marketplace worth and their terms was really controlled by the platform. This combined with the galore rank rewards and levels encouraged users to support referring caller accounts, the constabulary said.

• During the platform's reign, 60,000 subordinate accounts were created crossed 72 levels of hierarchical relationships and rank status, and the strategy progressive much than RMB 100 million, the station said.

• Among different selling tricks, the scammers said their level was a "unicorn" successful planetary blockchain applications and they adjacent organized online and offline lectures to beforehand the value of their technology, state-owned Shanghai paper The Paper reported.

• Despite a crackdown connected the industry, crypto scams are inactive prevalent successful China. The Supreme Court formally criminalized amerciable fundraising done integer assets successful February.