10 Major Crypto Scams That Rocked the Industry - Part 1

Crypto scams have been there since the early crypto days. It's one of the drawbacks of having a mostly unregulated financial sector.

Crypto scams have been around since the early days of cryptocurrency. It’s one of the unfortunate aspects of having a largely unregulated financial sector. The people behind these crypto scams are creative and find many ways to separate you from your digital assets. Some of these crypto scams were also very successful.

So, we take a closer look at 10 major crypto scams. This is Part 1; in Part 2 we cover another 10 major crypto scams.

OneCoin

OneCoin was a Ponzi scheme founded by Ruja Ignatova. They scammed investors out of $4 billion, claiming that their project was a ‘Bitcoin killer.’ Ignatova is on the FBI’s most wanted list after she vanished in 2017. However, her brother was arrested in 2019 and pleaded guilty to fraud.

Source: X

Thodex

Thodex was a Turkish crypto exchange. The owner, Faruk Fatih Özer, fled in April 2022, carrying $2 billion in his luggage. The exchange closed after claiming a cyberattack.

At that time, it had 391k users. In September 2022, the police managed to arrest Özer in Albania.

Source: X

AnubisDAO

In the wake of popular ‘dog coin’ projects, AnubisDAO launched in 2021. The project raised 13.6k $ETH. This was at the time worth $60 million.

Investors would receive the $ANKH token in return. The token launch was at the now defunct ‘Copper’ platform. However, there was no website or whitepaper.

Source: X

4. Squid Game

The Squid Game and its $SQUID coin was a P2E blockchain game. By buying a $SQUID coin, you could enter the game platform.

Its ATH reached $2,861 with a market cap of $2.1 trillion. It launched on the Binance Smart Chain. The scammers got away with $3.3 million.

5. Mutant Ape Planet NFT

Aurelien Michel is a 24-year-old French citizen who was living in the UAE at the time. He launched the sketchy Mutant Ape Planet NFT collection.

The NFTs were knock-offs and had no relation to the Mutant Ape Yacht Club. He got away with $2.9 million but got arrested at JFK airport in NYC.

Source: X

6. Luna Yield

Luna Yield was a DeFi yield aggregator. In August 2021, the team rug pulled the project for $6.7 million after only two days. It launched on SolPAD, a Solana-based IDO platform.

This was only their second project that launched. The scammers managed to launder their contraband on Tornado Cash.

Source: X

7. StableMagnet

StableMagnet promised investors huge returns on deposits in June 2021. The scamming team got away with $27 million.

StableMagnet’s team manipulated liquidity pool smart contracts. The project didn’t offer an audit. With a backdoor in the smart contracts, they managed to drain the funds.

8. PlusToken

PlusToken was a Chinese crypto platform. Between May 2018 to June 2019, it scammed its users out of $2.25 billion.

Today, that would be worth around $11 billion. This was also a Ponzi scheme. China arrested a total of 100 people. Sentences in November 2020 for ringleaders ranged between 2 and 11 years.

Source: X

9. WoToken

WoToken was another Chinese Ponzi scheme. This time, 715,429 people got scammed out of $1.1 billion. One of the team members was supposedly also involved in the PlusToken scam.

This happened between July 2018 and October 2019. Four team members got jail time. However, only $63.6M was ever recovered.

Source: X

10. BitConnect

BitConnect was another Ponzi scheme. In 2017 and 2018 it scammed users out of $2.5 billion. Their $BCC coin crashed from almost $525 to $1 on 17th January 2018.

Source: X

The project worked with a trading bot and offered high returns. This is the end of Part 1. Keep an eye out for Part 2 of major crypto scams.