China’s prominent Filecoin endeavor, the Space-Time Cloud Company, is facing legal scrutiny for allegedly operating a $92 million pyramid scheme. The company allegedly deceived individuals by promising high investment returns through their cloud storage technology, exploiting Filecoin’s block reward system.
The scheme amassed about RMB 669 million (~$91.5 million) in cash and cryptocurrencies from over 57,000 members across two platforms. This controversy has cast a shadow over the Filecoin community and the ecosystem.
The Space-Time Cloud Company leveraged Filecoin’s block reward system, using platforms like filpool.io to present a joint mining opportunity while covertly pushing storage servers to mine FIL. Despite Filecoin’s initial high value, it has drastically fallen from nearly $200 to around $4.04.
The company targeted investors by inflating the profit potential of its cloud storage technology, convincing them to buy at least 8 terabytes of cloud computing power to join and recruit others.
Prosecution data reveals that filpool.io had over 57,000 registered members, and bpool.io secured 143 partners, amassing significant sums in various digital currencies.
The alleged breaches have economic and societal implications, raising concerns about potential repercussions for the decentralized finance sector, extending beyond China’s borders.
By FCCT Editorial Team
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