The scam, Wotoken, took in roughly $1 billion worth of crypto at current prices from over 715,000 victims.
One of the scam’s core operators is purportedly linked to PlusToken — a multi-billion Ponzi that is believed to have impacted the price trajectory of Bitcoin on numerous occasions throughout 2019.
On 16th May, a case surrounding “super large MLM network” Wotoken had opened for trial on May 14 in Yancheng City.
The scam claimed to generate returns for users through employing algorithmic trading bots, offering referral commissions to affiliates. However, as with most MLM scams, the advertised proprietary trading software did not exist.
The scam reached the shores of Singapore in 2018. A whistle blower called David told us his part of the story.
David stated that they used to conduct weekly seminars at Sakae Building, which was located in Tai Seng. There were close to a hundred people attending the seminar at one time. The head speaker would start of with giving out inspirational speeches on how he can grow his profits by two or three folds in a year. How easy was it to earn such money. And how one could be like him, living the life, by just investing their hard earned money and introducing this scam to their friends.
Other speakers also would then come in to give their similar money making experiences and encourage new investors to bring in their friends. Basically, its a clear ponzi scheme, the more friends you bring in, the more money you get through various commission schemes. At one point, there were people who were encouraged to invest hundreds of thousands.
Some Singaporeans invested $10,000 some even invested more than $100,000.
Individuals would just have to invest their money. You do not even need to monitor the pricing of the coins you invested as they are taken care by an Artificial Intelligence called Arbitraged Trading Software.
A check done by one of the members in the group chat states that a check on ACRA showed that the Wotoken company which is based in Singapore is registered under a PRC.
In total, 715,249 registered users fell for the scam, resulting in Wotoken accumulating 46,000 BTC, over 2 million Ethereum, 292,000 Litecoin, 56,000 Bitcoin Cash, and 684,00 Eos — worth nearly $1 billion at the time of the arrest.
Six defendants faced trial for operating Wotoken, including one individual with ties to the notorious PlusToken Ponzi. All six defendants pleaded guilty, with the court recommending prison terms of between six months and 11 years.