Several Plustoken scam minds have been sentenced to 11 years in prison for defrauding cryptocurrency investors. Last week, on November 19, a court ruling showed that the Chinese government claimed it seized over $ 4 billion worth of cryptocurrencies from the Plustoken scam. Meanwhile, onchain investigators believe the Chinese government may have already sold a large number of coins and simply added the proceeds to the central treasury.
Plustoken Masterminds sentenced to 11 years in prison
Just recently, a ruling by the Jiangsu Yancheng Intermediate People’s Court, published on Nov.19, shows that the Chinese government has seized a huge sum of crypto assets worth over $ 4.2 billion.
According to the court filing, Chinese law enforcement has confiscated 194,775 BTC, 833,083 ETH, 79,581 BCH, along with a large hoard of LTC, EOS, DASH, DOGE and stablecoin tether (USDT).
New information from the South China Morning Post (SCMP) indicates that a number of Plustoken gang leaders have been sentenced to prison for their actions. The court ruling previously detailed the seized assets derived from seven members of the Plustoken gang.
The SCMP report indicates that the multi-level marketing (MLM) crypto scam was originally invoked in 2018 by an individual named Chen Bo. The project promised high returns and attracted millions of attendees until the project’s leaders got out of the scam in mid-2019.
The report also reveals that Chen and his colleagues used social media and meetups to attract victims of the project. Plustoken members have promised members returns of up to 18% for an arbitrage business that never really existed. Chen and other prominent MLM gang leaders have managed to attract 3,200 tier investors and nearly three million Plustoken members at the peak of its popularity.
Onchain research indicates that Bitcoin’s treasure was likely sold last year
Now in the cryptocurrency world, numerous advocates aren’t too worried about the logistics of how Plustoken scammers defrauded cryptocurrency investors. That part of the story is obvious, as the world has watched the Plustoken scam unfold like many other pyramid schemes. The biggest concern, even before the minds were taken into custody, is what happened to the crypto assets that the scammers obtained from the victims.
The court filing tells the public that the illicit proceeds from the Plustoken scam “will be treated in accordance with the law and the proceeds and capital gains will be confiscated from the national treasury.” However, @Ergobtc a researcher from OXT Research, shared information about the stolen coins, and those working in the field of blockchain analysis assume that the coins were sold on the open market.
OXT Research recently released a special report on the subject after the team studied onchain action. Furthermore, the researchers estimate that Plustoken’s size after shutdown was 200,966 BTC ($ 3.8 billion). Most of the latest Plustoken scam reports did not tell the story of Ergo and OXT Research, as many assume the Chinese government still has these coins. Ergo extensively traced the addresses of Plustoken and explained that the coins were also mixed before being sold.
The study states that 20,000 BTC ($ 382 million) was shuffled via the Wasabi wallet and over 150,000 BTC ($ 2.8 billion) was shuffled via a very simple process OXT researchers call “self-shuffling.” It is assumed that most of the coins were sold last year after being mixed and whoever sold them apparently took advantage of the Huobi exchange.
Many sales are assumed to have started in mid-2019, through to the end of the year. Additionally, regional reporter and crypto blogger Colin Wu also tweeted that the Chinese government probably sold the coins for fiat.
“The Chinese government has seized 190,000 BTC and 830,000 ETH from the Plustoken MLM case, for a total value of billions of dollars”, Wu tweeted. “The official announcement seems to indicate that the government has sold it and returned it to the central treasury managed by the central bank. The local reporter added:
At the moment we don’t know how the Chinese government sells [this] crypto and whether they are traded with CNY or USD. But Chinese exchanges like Huobi have a good relationship with the police, they will provide assistance if the police request it.
Governments are seizing more cryptocurrency assets these days
Additionally, Ergo also tweeted about Chen Bo’s cooperation with the police. “Let me understand, Chen Bo, the mastermind of PlusToken (arrested in June 2019), was tasked with selling Plustoken’s BTC, through a third-party company, on behalf of the CCP?” therefore She said. “In return, it just gets [eight] years in the gulag for concocting a billionaire [dollar] Ponzi? ” researcher asked.
Ergo also discussed the news that the Chaindigg company has been employed to dispose of the Ponzi coins and that there may be a connection with the Wotoken scam tokens as well. Wotoken was a similar pyramid scheme and it has been suggested that the minds of Wotoken and Plustoken were somehow connected.
Last October, news.Bitcoin.com reported that Wotoken’s minds were sentenced to jail, as the Yancheng City Intermediate People’s Court, Jiangsu Province, denied the detainees’ appeal. After showing some token graphs of Wotoken coin transactions, Ergo too he wondered:
Does that mean that Chaindigg was also responsible for handling Wotoken’s coins? This would explain why the coins were thrown into the same algorithm.
Even the OXT researcher asked whether or not the “Western surveillance firms” followed these transactions.
Governments are handling much larger quantities of digital assets seized these days and it is assumed that the Chinese Communist Party (CCP) was one of the largest holders of bitcoin last year. The news also follows the recent U.S. government seizure of bitcoin on Silk Road when they confiscated around 69,370 BTC, BCH, BSV and BTG.
Ergo’s findings indicate that the CCP has sold the digital assets, which suggests that most of the sales are over. The researcher’s statistics show that around 15,000 BTC may remain, while around 170,000 BTC would have been sent to well-known digital currency exchange addresses.
What do you think of the Plustoken survey and the onchain results? Let us know what you think about this topic in the comments section below.
Image credits: Shutterstock, Pixabay, Wiki Commons, OXT Research, Twitter,
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