- The Ponzi scheme’s associated address has acquired 22.37 million MATIC, or around $27.32 million.
- This MLM Ponzi scam is now Polygon’s fifth-largest stakeholder.
According to on-chain data, a multilevel marketing (MLM) ponzi project is the fifth-largest holder of the MATIC coin. The development has been discussed by both PeckShield, a crypto security service, and members of the community.
Over 22.37 million MATIC have been gathered by this Chinese MLM Ponzi scheme in the last several days.
After surpassing the current holdings of Binance’s hot wallet 2, the Chinese MLM Ponzi scam known as “Avatar” has emerged as the fifth-largest MATIC holder.
Leading blockchain cybersecurity company PeckShield found that an account linked to the Chinese Ponzi scheme Avatar jumped to the top of the list of holders of Polygon (MATIC) tokens. It was able to accumulate about 23.1 million Polygon (MATIC) tokens, or $26 million, in a short period of time.
Additionally, the address spent $122,000 in gas expenses during the last week, or around 100,000 MATIC. The Ponzi-related address performed more than 117,000 transactions on February 12, according to Chinese reporter Colin Wu, raising the “median of Polygon Gas to more than 700 gwei.”
The Avatar Ponzi scheme-related wallet operates with the following address ———-xc7728354f9fe0e43514b1227162d5b0e40fad410.
The project has received attention from the cryptocurrency world for a number of reasons, including the significant amount of gas it has consumed. The address has spent more than 100,000 MATIC on gas over the last week.
Even the hot wallets of Binance (BNB), the biggest cryptocurrency exchange, have been exceeded by the main contract of this scheme, which is currently the sixth largest account on the Polygon (MATIC) network. By the time of publication, the platform was in charge of 0.25 percent of all Polygon (MATIC) tokens in use.
However, the Chinese Ponzi project is believed to run on Chinese social media and proposes a referral staking protocol with extraordinarily large incentives (referral stake of 1% APR daily). Despite the paucity of information regarding the project, it is known that it is a Ponzi scheme.
It appears that the people running the Ponzi scheme trade MATIC as part of their programmes to benefit from it for their subscribers, using leveraged products, derivatives, and other complex trading tactics.
In essence, a Ponzi scheme is a fraudulent investment operation that pays out rewards to early investors by taking money from later participants.
The US Bankruptcy Court for the Southern District of New York commissioned an examiner to investigate the business model of the bankrupt cryptocurrency lender Celsius. The platform’s status as a Ponzi scheme was established once the final results were announced at the end of January 2023.