BTC Mining Investment Platform Declared Pyramid Scheme by South African Consumer Watchdog – Regulation Bitcoin News

The National Consumer Commission claims that approximately 4,000 South Africans invested in Obelisk, a supplier of bitcoin mining equipment, in order to participate in a pyramid scheme. According to the commission, participants may have suffered losses of up to $6 million.

Obelisk used Social Media Platforms for Lure Victims

A South African consumer watchdog, the National Consumer Commission (NCC) recently announced that Obelisk — a purported bitcoin mining equipment supplier — is in fact a pyramid scheme which has swindled millions of dollars from unsuspecting investors. According to the NCC, Obelisk was accused of fraud by investors and made its announcement.

A Businesstech report found that the investors believed they were buying bitcoin mining equipment, which would generate a steady income. They cost $18.75 to $24,850 according to the report.

Obelisk was accused of luring victims using social media platforms such as Facebook, according to a commission statement.

Participants were found on Facebook and required to invest a minimum amount. Participants were added to Obelisk Whatsapp group after they made an initial investment.

In an effort to persuade investors to make more investments, the watchdog increased returns to some of its clients by offering them small rewards.

Residents Warned Against Falling for Scammers’ Tricks

Investors were unable to withdraw funds, and soon problems began. According to the report, individuals who confronted operators of the scheme were blocked from accessing the Whatsapp group and then removed.

NCC confirmed 25 investor complaints that they received, claiming to have suffered losses of $41,400. The watchdog, however, believes that as many as “4,000 participants from eight Whatsapp groups” might have lost an equivalent of $6.18 million.

According to Thezi Mabuza, the NCC’s acting commissioner, South African residents must avoid being tricked by investment schemes that promise significant returns in a very short space of time.

“We implore members of the public to spare themselves from heartache and suffering by not joining these deceptive schemes. History is replete with many examples of these schemes that inevitably collapsed, often leaving a trail of financial distress, broken trust, friendships, and even broken families,” Mabuza said.

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Terence Zimwara

Terence Zimwara was a Zimbabwe Award-winning journalist and writer. His writings have covered the economic problems of several African countries and how digital currency can offer an escape route.