Vietnam is Investigating an ICO Fraud Amounting to $660 Million
Just when the crypto community is recovering from the $500 million hack of Coincheck hack earlier this year, another news of a possible million-dollar fraud from Vietnam could shake further grounds. As per reports, government authorities of Vietnam are investigating a digital currency scam which shows nearly 32,000 investors to be duped for a total of $660 million.
A startup name ‘Modern Tech’ based out of Vietnam’s Ho Chi Minh City is said to have been allegedly behind two big Ponzi schemes that involve digital currencies - iFan and Pincoin. A local news publication Tuoi Tre News on Monday said that the matter escalated when many investors started protesting outside the startup office on Sunday.
The online available details regarding the Initial Coin Offering shows the potential of being a Ponzi scheme as iFan boasts of giving investors a complete “risk-free activity” while the Pincoin promises of giving investors 40% monthly profits through different bonus structures.
Pincoin, based out of London, describes itself to be on a “mission to develop and promote blockchain technology and cryptocurrency in a rising global sharing economy to help people share assets, resources, time and skills more efficiently.”
On the other hand, iFan in its whitepaper promises to provide payment options for content creators and consumers. It says “The outstanding aspect of the iFan platform is the sharing of profits against celebrities, enabling them to generate revenue based on their content, images and information on social networks. Actors, idols, athletes, or celebrities all who act in present or even who have retired, they still manage and work to attract their fans.”
Both these digital currencies had launched their ICOs back in November-December 2017 when iFan reported 10 million coins sold at the price-range of $1.6-$1.8 per coin in its crowdsale. Pincoin also reported to having raised $150 million through its ICO.
The Vietnamese government and investigative agencies are still working on estimating the actual quantum of losses. However, following this incident the government in response has initiated several different steps in a direction to protect the investor’s interests.
On Wednesday, Vietnam’s Prime Minister’s office published a directive asking the country’s securities regulator and central bank to immediately start working on strengthening crypto-related activities in the country. Last year itself, the central bank of Vietnam has stated cryptocurrencies to be unlawful means of payments.
One of the major reasons that regulatory bodies have considered to interfere in the crypto markets is due to such increasing reports of frauds that trap and strip-off gullible investors of their hard earned money.