Mastermind of Zimbabwe Bitcoin Pyramid Scheme Disappears with $6 Million – Regulation Bitcoin News

According to reports from Zimbabwe, a person named Martin Mhlanga, the mastermind behind the Cryptoshares Bitcoin pyramid scheme, has disappeared along with over $6 million in investor funds. In addition to Mhlanga's disappearance, the people believed to be managing Cryptoshares' social media channels have also disappeared.

Unrealistic Cryptoshare promises

As a local report explains, Mhlanga had successfully used a series of unrealistic promises to lure many unsuspecting people into investments. For example, the report explains that many of the victims were lured into investments by claims that the first Cryptoshares investors received a monthly membership payment of $2,000. Investors were also promised a payout of twice the amount of the initial investment.

Assuming they would also receive the same monthly payment, some of Mhlanga's victims are said to have sold their properties just to raise the required money. Others are said to have borrowed the required initial investment from banks.

However, when September 1st – the day investors were due to receive their payout – rolled around, it dawned on many Cryptoshares investors that they had been scammed. In fact, one Twitter user, Tendai Tomu, pointed out that the first signs of the company's collapse were seen towards the end of August when Cryptoshares struggled to pay investors.

While the report suggests that some Cryptoshares investors have reported this scam to law enforcement, many in Zimbabwe's crypto space insist such a move will not achieve much. They point to other Bitcoin pyramid schemes such as Bitcoin Interchange that operate in a similar manner collapsed after many investors fled.

Stolen funds cannot be recovered

Meanwhile, some users like Tendai Tomu on Twitter are adamant that victims of this latest crypto pyramid scheme will never get their money back. Tomu called:

Sad indeed! I don't think the funds will be returned because he remembers paying early investors with deposits from new ones, so the equation never balances. The best thing people can do is learn from it.

Others like lawyer Prosper Mwedzi have recommended Reporting Scams on Cryptocurrency Exchanges. Still others, however, insist that such scams will return unless more is done to educate people about the basics of investing.

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