More

    The Crypto Ponzi Scheme Avenger – The New York Times

    “So that’s my money gone,” read the top comment in mid-October. “Lesson learned.”

    To Mr. de Hek, everything about the Hyper empire seems suspicious. On its website and in promotional videos, HyperFund explained that investors could buy “memberships,” starting at $300, and earn “rewards” that would accrue daily in their account. Those rewards took the form of “HU,” the internal trading currency, said to have parity with the U.S. dollar.

    And why would everyone’s HU triple in 600 days? Because the putative founders of HyperFund — Ryan Xu and Sam Lee, described on promotional sites as a pair of superstar blockchain entrepreneurs — were going to pour all that cash into promising and profitable crypto projects, which they claimed would eventually serve 30 million customers. They also said the company would go public on the Hong Kong Stock Exchange.

    It sounded plausible to many. Whoever ran HyperFund exploited the craze for crypto, which to most people at the time was a bafflingly complex technology that seemed to mint millionaires. But HyperFund never went public, and the only product it sold was memberships to HyperFund. Members who recruited new members got a cut of their recruits’ rewards, a perennial feature of pyramid schemes and an occasional feature of Ponzis.

    To Mr. de Hek, this sale of memberships, in the absence of any product, was a blazing red flag that he had seen all too often. Before the pandemic, he had created Elite: Six, a company that hosted twice-a-week, in-person networking meetings for small-business owners in Christchurch. Those who paid $60 a month could introduce themselves and pitch their company. Mr. de Hek vetted every pitch, and in more than a few cases the main product was a joining fee, which earned the right to recruit others and get a cut of their joining fee. And so on.

    “They were basically multilevel marketing companies,” Mr. de Hek said. “I hate them with a passion. I never let them in.”

    To understand that passion, and his mission to wipe out crypto Ponzi schemes, you need to know something about Mr. de Hek’s childhood. Like everyone in his family, he was raised as a Jehovah’s Witness.

    “From the age of 5, I was knocking on the doors of strangers, telling them that fires and earthquakes were happening for a reason, that the world was ending soon,” he recalled, describing being taught that only believers will survive the imminent destruction of earth.

    This content was originally published here.

    Latest articles

    spot_imgspot_img

    Related articles

    Leave a reply

    Please enter your comment!
    Please enter your name here

    spot_imgspot_img