Reports from Zimbabwe suggest that an individual by the name of Martin Mhlanga, who is the mastermind behind the Cryptoshares bitcoin pyramid scheme, has disappeared along with over $6 million in investor funds. In addition to Mhlangas disappearance, the individuals thought to be managing Cryptoshares social media channels have similarly vanished.
As one local report explains, Mhlanga had successfully used a series of unrealistic promises to lure many unsuspecting people into investing. For instance, the report explains that many of the victims had been lured into investing by claims that initial Cryptoshares investors were receiving a monthly membership payment of $2,000. Investors were also promised a payout that is double the amount of the initial investment.
Believing that they too would be in line to receive the same monthly payment, some of Mhlangas victims are thought to have sold their properties just so they could raise the required money. Others are thought to have borrowed the required initial investment from banks.
However, once September 1 the day investors were supposed to receive their payout rolled around, it dawned on many Cryptoshares investors that they had been scammed. In fact, as one Twitter user, Tendai Tomu points out, the early signs that the company was collapsing were seen towards the end of August when Cryptoshares was having problems paying investors.
While the report suggests that some Cryptoshares investors have reported this fraud to law enforcement, many in Zimbabwes crypto space insist such a move will not yield much. They point to other bitcoin pyramid schemes like Bitcoin Interchange, which similarly collapsed after fleecing many investors.
Meanwhile, on Twitter, some users like Tendai Tomu are adamant that victims of this latest crypto pyramid scheme will never recover their funds. Tomu said:
Sad indeed! I dont think the funds will be returned because remember he was paying early investors with deposits from new ones so the equation will never balance. The best people can do is to learn from this.
Others like lawyer Prosper Mwedzi have suggested reporting the fraud to cryptocurrency exchanges. However, still others insist such scams will recur unless more is done to educate people about the basics of investing.
What are your thoughts on this story? Tell us what you think in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
Visit link:
- Google removes malware Android apps used to secretly mine bitcoin - April 26th, 2014 [April 26th, 2014]
- Bitcoin exchange MtGox liquidated - April 26th, 2014 [April 26th, 2014]
- Bitcoin Wannabe Litecoin Emerges as Low-Price Challenger - April 26th, 2014 [April 26th, 2014]
- The Worlds First Bitcoin Debit Card Is Almost Here - April 26th, 2014 [April 26th, 2014]
- How does Bitcoin work? - Bitcoin - Open source P2P money - April 26th, 2014 [April 26th, 2014]
- Bitcoin - Wikipedia, the free encyclopedia - April 26th, 2014 [April 26th, 2014]
- The Bitcoin Group #27 - China Bans Bitcoin Again - Politics - Dark Market - Bitcoin VC - Video - April 26th, 2014 [April 26th, 2014]
- Edan Yago - Free Market Bitcoin regulation and Honduras free trade zones.mp4 - Video - April 26th, 2014 [April 26th, 2014]
- Bitcoin vs. Political Power: The Cryptocurrency Revolution - Stefan Molyneux at TNW Conference - Video - April 26th, 2014 [April 26th, 2014]
- Video: Roundup of This Week's Bitcoin News 25th April 2014 - Video - April 26th, 2014 [April 26th, 2014]
- Bitcoin Fredagsbar med Torben Mark Pedersen - Video - April 26th, 2014 [April 26th, 2014]
- Bitcoin and the Internet of Money - Video - April 26th, 2014 [April 26th, 2014]
- Bitcoin for Dummies - Video - April 26th, 2014 [April 26th, 2014]
- Bitcoin runner-up Litecoin emerges as low-price challenger - April 27th, 2014 [April 27th, 2014]
- Bitcoin or Gold? Squawk Walk Taipei- Squawkonomics - Video - April 27th, 2014 [April 27th, 2014]
- Bitcoin Miner AntMiner S1 180 - 200 GH/s Nu in de Aanbieding! - Video - April 27th, 2014 [April 27th, 2014]
- New Bitcoin Documentary: Boom or Bust - Video - April 27th, 2014 [April 27th, 2014]
- Bitcoin May v0.9.1 GitHub Source Code Development Visualization - Video - April 27th, 2014 [April 27th, 2014]
- Atomic-Trade Bitcoin Exchange. AML, BSA, FinCEN compliant - Video - April 27th, 2014 [April 27th, 2014]
- China Bans Bitcoin Again -- Bitcoin the Movie -- Startup for Startups Raises 2,000 BTC - Video - April 27th, 2014 [April 27th, 2014]
- 4/24/14 - Xapo Debit Card, Russia's 1st Bitcoin Conference, Silk Road 2.0 - Video - April 27th, 2014 [April 27th, 2014]
- What is Bitcoin? - Video - April 27th, 2014 [April 27th, 2014]
- David Andolfatto, How Does Bitcoin Work? - Video - April 27th, 2014 [April 27th, 2014]
- Australian Bitcoin traders hit by crash - April 28th, 2014 [April 28th, 2014]
- Bitcoin traders hit by Mt.Gox crash - April 28th, 2014 [April 28th, 2014]
- Market Extra: Bitcoin venture capital money hasnt kept up with buzz - April 28th, 2014 [April 28th, 2014]
- Bitcoin price slips as China steps up regulation - April 28th, 2014 [April 28th, 2014]
- Bitcoin price slips on China regulation - April 28th, 2014 [April 28th, 2014]
- Win .33 Bitcoin ($150 or so, Depending on BTC value) - Meme game for May 1st - Take My Bitcoins - Video - April 28th, 2014 [April 28th, 2014]
- Ron Paul on Bitcoin - Video - April 28th, 2014 [April 28th, 2014]
- btc.sx Bitcoin derivatives platform George Samman clip - Video - April 28th, 2014 [April 28th, 2014]
- 'The Rise And Rise Of Bitcoin' Filmmaker: 'There Is No Answer Yet' - April 29th, 2014 [April 29th, 2014]
- Bitcoin the movie: It just had to happen - April 29th, 2014 [April 29th, 2014]
- Bitcoin Vies with New Cryptocurrencies as Coin of the Cyber Realm - April 29th, 2014 [April 29th, 2014]
- The Bitcoin Meetup - BitcoinMKE Hosts Jeffrey Tucker - Video - April 29th, 2014 [April 29th, 2014]
- MIT Bitcoin Expo 2014 - Video - April 29th, 2014 [April 29th, 2014]
- Bitcoin Expo 2014: Fireside Chat with Dr Gavin Wood - Video - April 29th, 2014 [April 29th, 2014]
- Rise Bitcoin Singapore - Video - April 29th, 2014 [April 29th, 2014]
- Preview: Bitcoin Authenticator - 2FA for wallets - Video - April 29th, 2014 [April 29th, 2014]
- The Bitcoin Group #27 (Live) - China Bans Bitcoin Again - Politics - Dark Market - Bitcoin VC - Video - April 29th, 2014 [April 29th, 2014]
- 4/25/14 - More China uncertainty, Missourian bitcoin warning, BadLepricon malware - Video - April 29th, 2014 [April 29th, 2014]
- Money & Tech at The Rise And Rise Of Bitcoin Afterparty - Video - April 29th, 2014 [April 29th, 2014]
- New Bitcoin student club at MIT will promote the virtual currency - April 30th, 2014 [April 30th, 2014]
- 4/29/14 - MIT Bitcoin Project, Mt Gox revival plan, Mastercard lobbyists & Team Rubicon - Video - April 30th, 2014 [April 30th, 2014]
- BitCoin Dentist GoCoin Fox News Interview - Video - April 30th, 2014 [April 30th, 2014]
- Bitcoin Foundation Election Hiccups -- Pathetic Ohio Bans Bitcoins -- Dogecon SF 2014 - Video - April 30th, 2014 [April 30th, 2014]
- Bitcoin Slips to $420 as BTC China Halts Transactions - Video - April 30th, 2014 [April 30th, 2014]
- MultiSig Plus BitCoin Multi Coin Wallet looks like HUGE INVESTMENT potential! - Video - April 30th, 2014 [April 30th, 2014]
- Bitcoin: what happens when the miners pack up their gear? - May 1st, 2014 [May 1st, 2014]
- Dark Wallet Is About to Make Bitcoin Money Laundering Easier Than Ever - May 1st, 2014 [May 1st, 2014]
- Bitcoin Talk Show #7 -- Skype BitcoinTalkShow to Call in Live! 🙂 - Video - May 1st, 2014 [May 1st, 2014]
- Basic Bitcoin Bitches - Video - May 1st, 2014 [May 1st, 2014]
- Gold standard vs Fiat vs Bitcoin - Truthloader - Video - May 1st, 2014 [May 1st, 2014]
- How to Defund the System: Bitcoin vs. the Central Banksters - Video - May 1st, 2014 [May 1st, 2014]
- Bitcoin, Anarchy and Freedom with Roger Ver - Video - May 1st, 2014 [May 1st, 2014]
- MIT Goes Bitcoin-Wild - May 1st, 2014 [May 1st, 2014]
- Bitcoin Weekly 2014 April 30: Bloomberg adds Bitcoin to their market index, MIT to produce campus-wide bitcoin ... - May 1st, 2014 [May 1st, 2014]
- 'Dark Wallet' wants to make Bitcoin even harder to trace - May 1st, 2014 [May 1st, 2014]
- Bitcoin made simple (video animation) - Video - May 1st, 2014 [May 1st, 2014]
- Jon Matonis: Bitcoin - The future of commerce? - Video - May 1st, 2014 [May 1st, 2014]
- $100 in Bitcoin Going to Every MIT Undergrad - Video - May 1st, 2014 [May 1st, 2014]
- The Rise of Digital Currency - Video - May 1st, 2014 [May 1st, 2014]
- Money Goes Virtual: The Bitcoin Bourse - Video - May 2nd, 2014 [May 2nd, 2014]
- Bitcoin Lights with LIFX - Video - May 2nd, 2014 [May 2nd, 2014]
- Bitcoin: How We Got Here and Where We Are Going - May 3rd, 2014 [May 3rd, 2014]
- 5/1/14 - Larry Summers warns critics, Paym system & Bitcoin Center NYC roundtable - Video - May 3rd, 2014 [May 3rd, 2014]
- On est Connect S2 #07 1/2 : BitCoin et Musique sur Internet - Video - May 3rd, 2014 [May 3rd, 2014]
- MIT Undergrads To Receive $100 Worth Of Bitcoin This Fall - Video - May 3rd, 2014 [May 3rd, 2014]
- Why it only took ME less than 2 minutes to believe in Bitcoin - Video - May 3rd, 2014 [May 3rd, 2014]
- Bitcoin Basics and Regulation Thoughts from NH Liberty Forum - Bruce Fenton - Video - May 3rd, 2014 [May 3rd, 2014]
- PRIMER CAJERO DE BITCOIN EN BIT CENTER DE TIJUANA - Video - May 3rd, 2014 [May 3rd, 2014]
- Yelp adds Bitcoin acceptance to business listings - Video - May 3rd, 2014 [May 3rd, 2014]
- Bitcoin A Terrorist Threat? Counterterrorism Program Names Virtual Currencies As Area Of Interest - May 4th, 2014 [May 4th, 2014]
- How Does Bitcoin Works - Video - May 4th, 2014 [May 4th, 2014]
- 10 Things You Didn't Know About BitCoin - Video - May 4th, 2014 [May 4th, 2014]
- BITCOIN The Future of Money - Video - May 4th, 2014 [May 4th, 2014]
- Bitcoin Miner Review - Video - May 4th, 2014 [May 4th, 2014]
- The Bitcoin Group #28 (Live) - Yelp Lists Bitcoin - MIT Bitcoin $100 - Dark Wallet - Ohio Bans BTC - Video - May 4th, 2014 [May 4th, 2014]
- Bitcoin: Gary North is Mentally Deranged And Bitcoin Will Change Everything - Video - May 4th, 2014 [May 4th, 2014]
- Who is the Bitcoin Warlord? - Video - May 4th, 2014 [May 4th, 2014]