Kunming Chenggong hears the first case of a virtual currency pyramid scheme, involving more than 9.76 million USDT

On November 18th, according to a post on the public account of Kunming Chenggong District People's Court, the Chenggong Court recently tried the first case of a criminal organization and leadership of pyramid selling activities using virtual currency on a network platform. The suspects, including Yang, promoted the "XX Eagle" project as a blockchain financial platform from a certain country, guaranteed by overseas banks and funds, falsely claiming that the DAM (commonly known as eggs, egg coins, etc.) on the "XX Eagle" platform can be exchanged at a 1:1 ratio with the virtual currency USDT (commonly known as U coins, Tether). Yang and others deceived participants into recharging USDT to the "XX Eagle" network platform, and deceived them into developing subordinate members in multiple places through invitation codes, setting up wealth levels 1-4 based on the number of developed members and the amount of recharge funds.

After analyzing the blockchain assets involved and judicial accounting appraisal, as of May 30, 2022, the total amount of USDT recharge deposits by participants in the "XX Eagle" project was 9,762,260.02 USDT, equivalent to more than 65 million yuan. The Chenggong Court sentenced Yang and others for organizing and leading pyramid selling activities to one to six years in prison and fines respectively; confiscated illegal gains of more than 13 million yuan seized in the case, and mobile phones and USB drives were confiscated according to law.