Original - Odaily
While Web3 brings wealth opportunities, it also comes with certain risks and even some man-made traps. Recently, the private financing round defrauded incident spread on the X platform has attracted widespread attention.
Most of Web3s private equity financing rounds do not have relevant legal effect. They are basically trust-based financing behaviors, and investment traps and frauds occur frequently. Scammers often pretend to be community members with rich project resources, create their own identities through packaging, and gain the trust of victims to commit fraud.
Different from previous cases, the victims this time also include some senior practitioners in the encryption industry, including KOLs. Odailys investigation found that the total amount involved has reached 4.22 million yuan (statistics from the rights protection group), and most of the victims are mainland investors, with more than 50 people in total.
Through the report, Odaily hopes that investors can be more vigilant and avoid such scams. The following is the incident. The relevant content was explained by the victim and compiled by Odaily.
The scam lasted for more than a year and was associated with nearly 6 projects
Time goes back to May 2022, when new public chains such as Aptos and Sui began to emerge. Mainland investors were looking for relevant Chinese communities on Discord and Telegram, hoping to find like-minded community friends so that they could explore the benefits of the new public chains together. Early opportunities.
Scammers publish node tutorials for new public chains on Twitter and Youtube, attracting users to join the Discord and Telegram groups they created.
Since then, the fraudster often distributes benefits and holds activities in the community, creating an image in the community as the official community builder of the project, and is deeply trusted by community members. According to relevant group chats, you can also feel the respect of community members for him. .
In August of the same year, fraudsters began to express in the community that they could help everyone obtain the amount of Aptos private placement token financing. According to the victims description, the fraudster revealed that the information on the private placement round of financing came from the institution it contacted - Alameda.
Between August and December 2022, fraudsters continued toprivate chatPeople in the community asked whether to participate in Aptos’ private financing round. Due to the fraudsters performance in the past few months, most community members were convinced of his identity, so they did not become suspicious and thanked the fraudster for giving him the opportunity to participate in the private placement; even if no private placement contract was signed, no one in the community raised objections.
Since most projects have a lock-up period for their private equity rounds, fraudsters have also adopted this method and claimed that the lock-up period is one year. Since Aptos’ token APT will be launched in October 2022, the fraudster stated that the private sale unlocking time node will be November 12, 2023. This series of operations is more in line with Web3 practices, further dispelling investors doubts.
After the private placement, the fraudsters often held community activities. For example, the first community AMA event claimed to be Suis official was held in its Sui Chinese community, and suspected Sui officials also participated. According to the victims description, the community numbered close to 8,000 people at its peak.
For nearly a year, this fraudster has been active in the community, releasing his own updates from time to time, such as joining the APTOS Foundation and becoming a member of the foundation; he also revealed screenshots of chats with Sui officials, Showing the close relationship between the two; he later revealed that he had joined the core team of the Linera public chain. Below is a screenshot of the person’s certification information.
During this period, the fraudsters also frequently updated information about related projects, and community members also felt that the information descriptions were more realistic. At the same time, he often goes to Taiwan, Singapore, Hong Kong and other regions to participate in activities to package his identity.
When I woke up, the private equity scam was exposed
But the dream will eventually be shattered. On November 12, it is time to unlock the private placement round.
At this time, the deceiver has not yet shown his fangs and still explained to community members that the official did not want to unlock them all at once, but after his unremitting efforts, they were finally released to everyone on November 17. The whole behavior seemed very sincere, like the incarnation of the movie king.
Later, this person also proposed to test the wallet address reported by everyone before, and transfer 0.1 APT to each deceived person to check whether the account is available.
On the morning of November 17, the victim discovered that all the communities related to the fraudster had been disbanded, all social media accounts had been canceled, and the relevant traces had been cleaned up. The previously promised unlocking of private equity tokens had not been fulfilled.
It was only then that the victim woke up from a dream and realized that he had been deceived. Angry victims began to post on social media and spent a lot of money to find information about the scammers, but gained little. More victims began to join the group for warmth, actively discuss countermeasures, and try to make up for their losses.
Stories of private equity fraud are common, but there is always a question in everyones mind: Why do scammers still try to disguise their identities for up to a year after they are successful? Could it be that the previous information on the private placement rounds of related projects was true, and the scam was not disbanded until the unlocked tokens were transferred to the scammer’s own account?
According to the victims self-report, the fraudsters have continued to use similar techniques to privately chat with other community users during the year; in addition to Aptos private financing, projects such as Sui, Linera, ZKS, and Starknet have all been labeled as private placements to commit fraud.
Regarding the issue of victim asset recovery, Ms. Xiao Sa, director of the Bank of China Law Research Association, told Odaily: “There is no signed agreement, only WeChat chat records and on-chain token transfer records, which means that even if they are involved in litigation, investors may still face the burden of proving evidence. The risk of failure. In addition, the investment target is virtual currency, and its transfer is carried out through the wallet address. Although the record is recorded on the Internet, the query channel needs to be carried out on major cryptocurrency websites. Therefore, when the investor reports to the judicial authorities When presenting transaction records, the evidentiary power of the website query results may be insufficient compared to bank transfer records, and there is a high probability that they will not meet the proof standards for various types of litigation. Secondly, the real-name information of the wallet address cannot be directly reflected in the query results. How to prove the receipt? It will also be difficult for the currency side to communicate with the counterparty.”
Odaily reminds everyone not to easily trust certain project fundraising information that even large institutions cannot get rounds of, let alone the investment promises of strangers, be vigilant and avoid being fooled.