Slashdot Mirror
Large Bitcoin Ponzi Scheme Collapses With a Loss of $5.6 Million
New submitter beltsbear writes "Despite the many people calling it out as a Ponzi scheme from the beginning, Pirateat40 was able to collect millions of dollars worth of Bitcoins from thousands of Bitcoin users. At almost every stage Pirateat40 copied the path of the EVE Online Ponzi scheme except on a much larger scale with a far more liquid take. Now, it has shut down, and investors are wondering where their digital currency went. Quoting: 'He claimed that BS&T was sitting on 500,000 BTC on the day of the shutdown, worth more than $5.6 million USD at today's price of $11.38. "Once my process is released you'll understand more of how coins move around," he told members of the Bitcoin community last week. Pirateat40 initially promised to refund his investors' Bitcoin deposits plus interest within a week, effectively admitting that he did not have the Bitcoins on hand. The fund normally paid out on Mondays, but last Monday and today have passed so far without refunds. BS&T investors are complaining loudly and so-called "pass-through" funds that invested with BS&T are shutting down. As of this writing, BS&T says there is "no ETA on payments."'"
oh wait.
(But seriously, can the SEC even touch him? If not, that imparts a serious lesson to everyone who uses BC for financial trading rather than just an online payment method.)
See, this is why regulation is bad. Bad people are prevented from setting up schemes.
Schemes that are only obvious to those that are educated on such things.
Turrble!
Surely you mean 'modpointii'.
"I'm not much interested in interoperability. I want substitutability. I want to be able to throw your software out."
"A real scammer would never put the word 'pirate' in his handle. Therefore this guy must be trustworthy..."
Fringe cultist demands use of biological weapons, news at 11.
If you were blocking sigs, you wouldn't have to read this.