Ponzi schemes in the crypto ecosystem can be traced back to every single bull run that attracted a new wave of naive investors. Although such scams maintain its stronghold within the budding markets, Tron made headlines after being linked to a billion-dollar Ponzi scheme with Chinese investors.
A video surfaced on Twitter showing local Chinese police officials present in Tron’s Beijing office. They were called in to protect the on-duty staff from an angry mob. Based on a recent report by a local news source, an investment scam resulted in a loss of at least $30 million, and is alleged to have ties to the Tron blockchain. Out of the huge list of scammed individuals, one woman reportedly committed suicide, fueling outrage towards Tron and its supporters.
Tron CEO Justin Sun had previously acknowledged the rumors of the scam by tweeting,
“As a leading blockchain protocol, there are Ponzi schemes using #TRON, #BitTorrent or #uTorrent names like “MMM #bitcoin, #Ethereum pyramid & #EOS ecosystem schemes”. We will never ask you to send money. Be careful & hodl your $TRX/ $BTT”
The price of Tron underwent an upsurge over the weekend, scaling the market cap to $2.3 billion. After news of the suicide broke, the price fell sharply.
Justin Sun responded to the videos circulating by reiterating that all was well with Tron.
@Tronfoundation and @BitTorrent is fine. Everything is fine. We are preparing for #BitTorrentSpeed launch today. Stop spreading fake news and pictures.
— Justin Sun (@justinsuntron) July 8, 2019