Bitcoin Ponzi Scheme USI Tech Finally Announces its Fake Crypto Mining Operation End
Usi-Tech announced an ambitious plan involving investing in BTC mining packages last year. These BTC mining packages seemed suspicious from the start, and Usi-Tech recently confirmed this much after announcing an end to its affiliate back-office crypto mining charade.
Caving Under Pressure
As mentioned, Usi-Tech’s BTC mining packages were suspicious from the start. This caught the attention of U.S. regulators who demanded proof and effectively spooked the company. Lacking the required proof, the company’s founders panicked and ended up shutting all U.S. operations in April 2017. They, however, kept up with the crypto-mining charade.
Interestingly (but unsurprisingly), more and more people continued investing in the ponzi scheme in spite of the company’s collapse. However, investors have been opening their eyes to the truth and asking questions. It is this latest pressure from investors that has led to this latest announcement.
A Classic Ponzi Scheme
Mining cryptocurrencies is considered cheaper than actually buying cryptocurrencies. Crypto mining has become increasingly popular over the recent past, and several enterprises have opened up around it. Usi-Tech took advantage of this popularity by promising its investors that it would mine cryptocurrencies on their behalf while in fact, it did not have the capacity to do this.
The fact that Usi-Tech resulted in using investors’ money to pay off other investors categorized its BTC mining packages as a classic Ponzi scheme. The company announced on February this year that income generated from BTC 2.0 mining packages would be used for, among other things, paying off investors who had bought the BTC 1.0 packages.
Other factors also add up to give this plan all the hallmarks of a Ponzi scheme. For starters, the company’s founders have been using investors’ money for personal pleasures. For instance, co-founder Horst Jicha has severally been spotted driving a yellow Lamborghini and living large. Joao Severino and Ralf Gold are also living large albeit on a lower level compared to Horst.
Blame The High Energy Costs, Apparently
There is no doubt that Usi-Tech was running a Ponzi scheme, but Hurst and co-founders are blaming energy costs instead. Speaking to reporters, Hurst said that the rising energy costs, coupled with the fact that Bitcoin prices have been falling over the recent past, were making it unprofitable to mine BTC. Interestingly, other Ponzi schemes that have been running similar charades are also blaming high energy costs for their woes – similar Ponzi schemes have been closing shop since U.S. regulators started investigating Usi-Tech.
Ironically, Usi-Tech co-founder Hurst Jicha invested $1.5 million in an alternative source of energy in spite of complaining of high energy costs. This was disclosed after Horst filed a lawsuit against Ahern Energy demanding a return of his $1.5 million investment. The “investment” was meant to finance the development of a permanent magnet generator that would slash Usi-Tech’s energy costs by up to 95%, but the technology is apparently wanting.
Usi-Tech has been running a bogus investment scheme since 2017, and it has resulted in the loss of millions of dollars for a majority of investors. The company finally caved in and admitted that it was indeed a Ponzi scheme, but there is still no news about refunding investors.