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Ponzi scams have emerged as the major threat for the new and existing crypto users. The growing cryptocurrency user base that has created a neck to neck competition between crypto-based companies. Every nation’s regulators have a list of companies eradicating the established image of crypto and digital assets.
The Securities and Exchange Commission of the United States has detained 17 individuals in connection a Ponzi scheme. According to the press release of the regulator agency, the individuals involved with CryptoFX LLC have made 40,000 investors their victims.
Gurbir S. Grewal, the Enforcement director at the SEC, notes that “We allege that CryptoFX was a $300 million Ponzi scheme that targeted Latino investors with promises of financial freedom and life-altering wealth from ‘risk-free’ and ‘guaranteed’ crypto and foreign exchange investments.”
He added, “In the end, the only thing that CryptoFX guaranteed was a trail of thousands upon thousands of victims stretching across ten states and two foreign countries. A scheme of that size requires lots of participants, and as today’s action demonstrates, we will pursue charges against not just the principal architects of these massive schemes, but all those who further their fraud by unlawfully soliciting victims.”
“After filing the initial charges in this case and obtaining emergency relief, we continued our investigation to identify additional individuals who allegedly played roles in this massive Ponzi scheme,” said Eric Werner, Director of the SEC’s Fort Worth Regional Office. “Our efforts bore significant fruit, as today’s charges and allegations demonstrate.”
The filing details that the individual has raised $300 Million, but they did not use the majority of funds for the purpose they raised it.
Growing Scams Troubling Crypto Enthusiasts!
As technology has evolved rapidly, significant developments in scamming and frauding techniques have been seen. Bad actors have learned many new methods to easily defraud investors or crypto moguls.
In a recent filing, the Federal Bureau of Investigation (FBI) noted that the losses from crypto scams surged by more than 53% in 2023 compared to 2022. In 2022, the market suffered a loss of $2.57 Billion from scams.
However, in the past few quarters, hackers have used crypto mixers and other software to hide the origin and end of the cryptocurrency.
Market Price Updates
The fear and greed index of CoinMarketCap shows extreme greed, with 89 points, which might lead to bearishness in the market. The market capitalization of cryptocurrencies slips 5.72% over the past 24 hours.
Bitcoin, the market leader, has most recently traded at its all-time high price of $73,750; the price failed to sustain higher for a longer time. As of writing, BTC was trading at $68,123, with an intraday decline of 5.27%.
Ethereum, the second most discussed crypto in the market, has lost over 5.30% over the past 24 hours. Conflux (CFX) grew 8.02% in the past 24 hours, which makes it the leader in the intraday gainers’ list, followed by Fetch(dot)ai (FET) at 5.20%.
Disclaimer
The views and opinions stated by the author or any other person named in this article are for informational purposes only and do not constitute financial, investment, or other advice.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
