Man Arrested in China for 15 Billion Bitcoin Fraud

By Faith Magbanua, June 26, 2018 00:06 AM


With all the sham and speculations crawling around bitcoin, one man in Eastern China has been arrested scamming nearly 100 million yuan (nearly US$15 million) from 50 investors in three months, state media reported on Sunday, June 24, 2018.

The suspect - identified only by his surname of Zhang, aged in his 20s and from Anhui province - claimed in online posts at the end of last year that he had a reliable supply of bitcoin mining machines, which at the time were in high demand with a single unit of the digital currency trading as high as US$10,000.

Zhang offered the machines for sale for 10,000 yuan (US$1,500) - compared with the then market rate of nearly 30,000 yuan - on the condition that they would be delivered two months after payment, according to the state broadcaster China Central Television (CCTV).

At the beginning, people are skeptic on making and offer; however, the investors' doubts were dispelled by orders being fulfilled, Fu, one of the fraud's victims, was quoted as saying.

However, after further investigation, the police later found that the suspect had bought the machines at the market rate and made a loss of at least 20,000 yuan on each one.

Tianjin police seized 600 bitcoin mining computers after the local grid reported an abnormality in the power usage.

After not paying on more than 3,000 orders by mid-January, Zhang disappeared.

Two months later, Zhang turned himself in to the police, saying he could not continue because the supply of the machines had slowed and their prices had increased.

In addition, the earnings he got from his sales were said to have been partly spent on the mining machines and luxury cars, the report was seen via CCTV.

On the other hand, the alleged scammer has been in the custody of the police and is waiting to be prosecuted.

What is Bitcoin?

Bitcoin is a new currency that was created in 2009 by an unknown person using the alias 'Satoshi Nakamoto'.

Its purpose is to make transactions with no middle men - meaning, no banks. 

Bitcoin can be used to book hotels on Expedia, shop for furniture on Overstock and buy Xbox games. But, much of the hype is about getting rich by trading it. Since 2017, the price of Bitcoin skyrocketed into the thousands marker.

China is one of the most active countries in Bitcoin trading before trading platforms were banned by the People's Bank of China in January.


Related Article

Must Read

comments powered by Disqus

More from CCD

Tesla Experiencing 'Delivery Logistics Hell'

Clients of Tesla will be experiencing some delays in getting their new cars from the company.

Chinese Golfer Becomes 2018 European Tour Champion

One of China's top golfers makes history in the European Tour.

Hong Kong and Southern China Starts Clearing Operations After Super Typhoon

The damages caused by Mangkhut are now being assessed in China..

Chilean Priest Expelled by the Pope After Involvement in Child Sex Abuse Case

Another Chilean priest is removed from the church while under the investigation for his alleged involvement in a child sexual abuse case.

Pope Francis to Sicilian Mafia: 'Repent'

Pope Francis calls upon to the mafia on his address during a visit in Palermo this weekend.

Super Typhoon Mangkhut Makes Landfall in China

After the Philippines, Manghkhut makes its way to China.

Sexual Abuse Victims Slammed Pope Francis

Pope Francis is facing more criticism over the sexual abuse crisis in the church.

Tapeworm Extracted from Chinese Man's Brain

One odd news in China is currently making headlines.

Philippines Braces for Super Typhoon

A new super typhoon is currently making its way across the Philippines.

Russia Launches Largest Post Cold War Military Exercise

Russia's military power is on full display in its joint military games with China and Mongolia.