Velox 10 Global Bitcoin Pyramid Scheme in Brazil Robs Investors in Kenya of Millions
Not long after Bitcoin was created, cyber criminals started jumping in and finding ways to steal from unsuspecting investors. There has been malware and other viruses, but these criminals have learned that the easiest way to defraud someone is to go directly to the source. Pyramid schemes are not a new concept, but the use of Bitcoin in these scams has been lucrative for hackers. Unfortunately, in cases like that of Velox 10, the scam has been detrimental to Kenyan investors.
According to a recent report from The Next Web, this alleged project was based in Bitcoin, involving an extensive pyramid scheme that was launched in September 2017 at the Hotel Intercontinental, Nairobi.
Investors were encouraged to contribute to a Bitcoin investment fund with the promise of dividends to be paid out. Ricardo Rocha, the founder, promised up to $4,000 in daily profits to anyone who would participate. However, this amount could vary, based on the membership fee that the user chose.
The promises did not end there. Rocha went as far as to promise the biggest contributors that they would be eligible for a fully covered journey to the United Arab Emirates, where they would meet major businessmen in the industry.
One of the victims in this case was even told her contributions could bring her a 50% profit, and that the number would increase even more by bringing in other friends to this arrangement.
The victim, which Nairobi News names as Esther Muthoni, ended up wiring a total of $3.2 million Kenyan shillings to the project, which is about $32,000 in USD.
Though she recruited a friend named Lucy Kamatu to the platform for a contribution of 550,000 Kenyan shillings, she still saw no return on her investment after six months, and subsequently called the police. There has still yet to be any kind of refund.
Now, the website for Velox 10 is nowhere to be found, since it decided to take the path of an exit scam this week. The website shows absolutely nothing now, and the domain is actually available for buyers in an auction-style sale.
When the company closed, they were holding millions in Kenyan shillings that the investors had contributed to the cause.
This whole plot sounds a lot like what happened with BitConnect, serving as an unfortunate reminder that cryptocurrency education is a necessity before falling into a trap. Along with Muthoni, there have been seven Kenyan investors that have filed cases with the High Court of Kenya to prevent Velox from any kind of operations, but it was not shut down.
At the moment, The Next Web state that the investigations are ongoing, but investors still need to be careful. Whenever there is a company that says the user can earn more through bringing in more investors, it is a major sign that the company could be a massive pyramid scheme.
Every investor needs to thoroughly examine an opportunity like this one before they take on a new and exciting investment; it may save millions of dollars in debt and heartache.