Analyzing Suspicious Crypto Schemes in China

Multi-level marketing (MLM) systems, in which early “investors” are paid off with the buy-in money from investors further down the line, have a reputation as often being scams.

Large-scale crypto projects like Plustoken, which critics have accused of being scams, have grown in popularity and provided good returns — at least for investors who got out at the right time.

Many crypto scams operate in a distributed fashion, meaning it often takes a long time before they can be shut down by law enforcement. For example, a local police bureau in Changsha, Hunan investigated and punished a local chapter of the Plustoken project for running an illegal pyramid scheme in March 2019. However, that event did nothing to prevent the spread of Plustoken to other localities and countries. The project continued operation until its website went down and funds disappeared on June 29. Read More...