Industry

Vietnam: Startup Modern Tech Goes Dark After Taking $660 Million From Investors in Two ICOs

Thomas Delahunty | April 10, 2018 | 11:18 pm
Industry

Vietnam: Startup Modern Tech Goes Dark After Taking $660 Million From Investors in Two ICOs

Thomas Delahunty | April 10, 2018 | 11:18 pm

Ho Chi Minh City-based startup Modern Tech has gone dark after duping 32,000 people of an estimated VND 15 trillion ($660 million) in relation to two fake cryptocurrency projects and their initial coin offerings (ICOs).

On Sunday, dozens of disgruntled investors gathered in front of Modern Tech’s headquarters in the business district of Ho Chi Minh City carrying signs denouncing the company’s fraudulent activities and demanding refunds, reports local news outlet Tuoi Tre News.

The owner of the Vietnamreal building where the startup was headquartered told reporters that the company had cleared out its office about a month prior to the events.

Modern Tech had claimed to be the authorized Vietnamese representative of two cryptocurrencies, Ifan and Pincoin, and was responsible for conducting two ICOs on their behalf. The team, which was made up of seven Vietnamese nationals, held conferences in Hanoi, Ho Chi Minh City, and even remote areas to lure investors to their operation.

Ifan and Pincoin

Ifan — which Modern Tech claimed was created under Singaporean laws — was marketed as “the most advanced social network” for celebrities and artists, enabling them to better connect with their fans. Its native token was intended to be used for album downloads, live performances, ticket purchases, as well as merchandises and endorsements.

Pincoin — a project initiated in Dubai — was marketed simply as an “investment opportunity” promising up to 40% in monthly profit. It claimed to be overseen by the so-called PIN Foundation. Investors were told that the tokens they receive would see their value skyrocket once they hit the secondary market. Modern Tech also promised an 8% commission for every new member introduced.

Investors first began to grow suspicious when the startup stopped paying commissions in fiat currency, but digital coins. Because of this, investors could see the value of their investment rise on a daily basis, but were unable to actually withdraw anything in cash. They took to social media to lament, some claiming they had lost a fortune investing in the alleged Ponzi schemes.

Scams in the cryptocurrency space have become increasingly popular as criminals look to tap into the Bitcoin frenzy to lure investors into “the next big thing,” often promising absurdly high rates of return.

Earlier this month in India, self-proclaimed “cryptocurrency guru,” businessman, and crypto-entrepreneur Amit Bhardwaj was arrested for allegedly scamming investors out of $307 million in the state of Indian state of Maharashtra alone.

Bhardwaj, who was on the run for almost a year, was arrested at the Bangkok airport on April 4th, and later brought to Pune to face the trial. He is accused of cheating investors with Bitcoin-based Ponzi schemes. Officials involved in investigations told India Today that Bhardwaj’s alleged scam could run between $769 million and $2 billion.

Bhardwaj operated several ventures including GainBitcoin, GBMiners, MCAP, and GB21. His book Cryptocurrency for Beginners was promoted on social media by numerous Bollywood actors.

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