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Chinese authorities charge six people over $5.8B PlusToken ponzi scheme

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Six of the 109 individuals recent arrested by Chinese authorities in connection with the $5.8 billion crypto Ponzi PlusToken have been charged.

The defendants Chen Shaofeng, Luu Jianghua, Lu Jianghua, Lu Qinghai, Jin Xinghai, Wang Yin, and Zhang Qin were charged by prosecutors in Xiangshui County and Yancheng City on September 7. The authorities said they were “suspected in organizing and leading criminal pyramid schemes.”

Official announcement of PlusToken scammers’ prosecution: 12309.gov.cn

109 individuals suspected of involvement with PlusToken were arrested in late July, including 27 persons believed to be the scam’s executives along with 82 “key” promoters. 

The accused ringleader of the scheme was also arrested in May, while a further six suspects were extradited to China from Vanuatu in July 2019.

PlusToken published its whitepaper in February 2018, claiming to be a South Korean crypto exchange offering interest-bearing accounts generating returns of between 10% and 30% per month in the form of its native token ‘PLUS’.

The scam took in more than 200,000 Bitcoins (BTC), 789,000 Ether (ETH), and 26 million Eos (EOS) from approximately $3 million unsuspecting investors by May 30, 2019.

After PlusToken users found they could no longer access their funds during June, Chinese police became involved. No major movements of PlusToken funds appear to have taken place since the last arrests, with the last known transfers from PlusToken wallets taking place in late June.



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El Salvadorians take to the streets to protest Bitcoin law

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Protesters calling themselves the Popular Resistance and Rebellion Block have come out against El Salvador’s government passing a law making Bitcoin legal tender.

A Tuesday tweet from local news outlet El Mundo shows El Salvadorians carrying banners saying “no to Bitcoin” in the streets of San Salvador demanding a repeal of the country’s Bitcoin law. Legislative assembly members Anabel Belloso and Dina Argueta addressed the protesters after first meeting the group separated by a barrier of razor wire.

In a letter made available at the protest, the Popular Resistance and Rebellion Block group claimed that President Nayib Bukele passed the law making the cryptocurrency legal tender in the country without proper consultations with the people. It also cited the volatility of Bitcoin (BTC), comparing investing in the cryptocurrency to playing the lottery: “betting on the lottery is a voluntary act, while Bitcoin is required by law.”

Related: Coercion and coexistence: How El Salvador’s Bitcoin Law may change global finance

However, the group’s main grievance around the Bitcoin legal framework seemed to be centered around a perceived disparity in the cryptocurrency’s usage by the government when compared with the average resident in El Salvador. Protesters said Bitcoin “only serves some large businessmen, especially those linked to the government, to launder ill-gotten money.”

“Entrepreneurs who put their capital in Bitcoin will not pay taxes on their earnings,” said the letter. “In addition, to apply Bitcoin the government will spend millions of dollars of the taxes paid by the people.”

They added:

“Bitcoin would facilitate public corruption and the operations of drug, arms and human traffickers, extortionists and tax evaders. It would also cause monetary chaos. It would hit people’s salaries, pensions and savings, ruin many MSMEs, affect low-income families and hit the middle class.”

Though passed by El Salvador’s government and signed into law by Bukele in June, the law recognizing Bitcoin as legal currency in the country will not go into effect until Sept. 7. The Popular Resistance and Rebellion Block’s protest was aimed at government officials to demand the law be repealed. In addition, the World Bank has also refused to help El Salvador transition to a Bitcoin-friendly framework, given its “environmental and transparency shortcomings.”

Related: What is really behind El Salvador’s ‘Bitcoin Law’? Experts answer

During a scheduled visit by the U.S. State Department earlier this month, Under Secretary of State for Political Affairs Victoria Nuland suggested El Salvador ensure Bitcoin is well regulated and transparent, but did not explicitly say anything against the country’s move to a more digital economy. Some proponents of the law including Bukele have suggested Bitcoin could help facilitate remittance payments from El Salvador citizens living abroad and lessen the country’s reliance on the U.S. dollar.