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SEC Charges Eleven Individuals in $300M Crypto Pyramid Scheme

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Re: SEC Charges Eleven Individuals in $300M Crypto Pyramid Scheme

#41

Post by orwin »

paranoidrobot wrote: post #8

I mean, it's some progress, I guess. How long until the US Gov goes after all the folks who keep doing pump & dump/"rug pull" b.s with new coins? There seems to be a never-ending trail of those.

I'll get some heat, but i reached one of my school friend during covid and asked him what he was doing. He had a gig where he was coding snippets of solidity code to create "almost" solid coins, and publish those on the ethereum blockchain. And was paid a lot. Like FAANG level of money, in Europe (UK, it was a bit before Brexit).

Now, i don't understand this particular tech very well, so i might make a mistake, but from what i understood, he was actually creating shitcoins "templates" which could seem seemingly rug pull immune (like wait time before withdrawal? Like i said, i don't know the space very well, it doesn't really interest me), but add a smallish backdoor. His company (it was 2 dev one marketing) then sold those coin template to diverse people and sold installation, formation and support of like six month.

Would his company be targeted by the US gov? it seems like he was enabling scammers while not taking any personnal money from anyone. Wasn't this very sketchy? By the way, i think his company at first wanted to be on the "Wish" market (cheap dropshipped stuff from China) and then sold dropshipping websites template, so i guess this was actually a moral upgrade?

Re: SEC Charges Eleven Individuals in $300M Crypto Pyramid Scheme

#42

Post by orwin »

paulpauper wrote: post #3

74 votes and a single comment, I think that is record high ratio. The Securities and Exchange Commission today charged 11 individuals for their roles in creating and promoting Forsage, a fraudulent crypto pyramid and Ponzi scheme that raised more than $300 million from millions of retail investors worldwide, including in the United States. Those charged include the four founders of Forsage, who were last known to be…

I think there is some truth about Tate's comment on some adolescent/young adult male from middle-class families (i'd add: without cultural capital, and remove the color denominator as in my country, social class seems to have way more incidence).

Nobody really care about them, or empathize with them, to the extent than before a debate i had with someone with opposing views on a lot of things, i myself was thinking about coinbros, guys in the hustler University or scammed into giving money to fake Elon musk something like: they have money to spent, they will loose some and get help from their parent at some time.

But in fact, they aren't really middle class. Some of them are and will get support, some think they are and will get burned hard (or have their parent and close families suffer). They are targeted by the same scams the 70s-90s housewives were: they have holes in their education, a strong external belief system, are an easy demographic to target and just got access to money and don't know what to do to get more. So instead of madoff-like scams, MLMs with beauty products and other "housewivy" stuff, and revolving credits "get money now to make money later" its now crypto and Get Rich quick schemes sold for 50 dollars a month. Basically the same scams, just a different audience.

But while it is easy to get empathy for housewives who just got the right to have their own bank account, drive alone (my grandmother had fun anecdata about this, my grandfather was 20 year ahead of time) and go to a movie unsupervised, it is a bit harder to have some empathy for the new target of those. Because they are somehow like me, only with a bit more money at birth, in a more centralized place, and the fundamental attribution error is hard to get rid of as it stroke my ego, when it was mostly luck and amazing parenting (and having great parents is luck too when i think about it).

Re: SEC Charges Eleven Individuals in $300M Crypto Pyramid Scheme

#43

Post by flatiron »

hnthrow1010 wrote: post #30
TedDoesntTalk wrote: post #21

Earlier quoted context omitted.

What crime are the fiat->coin exchanges committing? (Excluding the insider trading of one individual at coinbase)

If you ask me, they should all be shut down for selling unregistered securities, because all crypto tokens fit closest to that definition more than anything else. It's impossible for these tokens to actually function as a currency, both technically and legally. They're not a new class of assets, the idea of tradable tokens is not new either.

Exactly my point. They are selling in fiat currency a lie. That 100% is accessible for litigation. The whole crypto->crypto thing could be seen as not a crime because who can tell it’s worth other than the darn fiat converter!

Re: SEC Charges Eleven Individuals in $300M Crypto Pyramid Scheme

#44

Post by kayamon »

humaniania wrote: post #32
dannyw wrote: post #22

Earlier quoted context omitted.

If it's actually on chain as a smart contract, it can't be shut down unless the code was written to allow it.

You think blockchain is immune to DDoS?

Good luck taking down Bitcoin.

Re: SEC Charges Eleven Individuals in $300M Crypto Pyramid Scheme

#45

Post by paranoidrobot »

orwin wrote: post #41
paranoidrobot wrote: post #8

I mean, it's some progress, I guess. How long until the US Gov goes after all the folks who keep doing pump & dump/"rug pull" b.s with new coins? There seems to be a never-ending trail of those.

I'll get some heat, but i reached one of my school friend during covid and asked him what he was doing. He had a gig where he was coding snippets of solidity code to create "almost" solid coins, and publish those on the ethereum blockchain. And was paid a lot. Like FAANG level of money, in Europe (UK, it was a bit before Brexit). Now, i don't understand this particular tech very well, so i might make a mistake, but f…

> it seems like he was enabling scammers while not taking any personnal money from anyone.

"X didn't scam anyone, X just sold a template that allowed others to scam".

If there's no reasonable other legitimate purpose, then it's still profiting from scamming, albeit at one layer of abstraction.

> Would his company be targeted by the US gov?

If it turns out that he was enabling scammers to scam, then yeah - I would hope so.

Re: SEC Charges Eleven Individuals in $300M Crypto Pyramid Scheme

#46

Post by harambae »

echelon wrote: post #31
gtvwill wrote: post #27

Earlier quoted context omitted.

You could make hosting and distribution of the code a prohibited act. Wanna still host that Blockchain if it can get you arrested? Just cus it lives as code doesn't mean someone or some group isn't responsible for distributing it.

> You could make hosting and distribution of the code a prohibited act. Wanna still host that Blockchain if it can get you arrested? And there goes the blockchain. I'm shocked it hasn't happened already given the fact that many popular blockchains allegedly host illegal images in the transaction metadata. That's all the FBI needs. The only reason I can imagine is that blockchain and crypto are still useful to people…

https://www.bbc.com/news/technology-47130268

For anyone who isn't familiar with that story (maybe there are other cases, I'm not sure)

Seems more like (a very dark form of) trolling

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