Wednesday, June 29, 2022

New Zealand Bitcoin Company Possibly Stealing Millions From Associates

New Zealand Bitcoin Company Possibly Stealing Millions From Associates

A New Zealand-based website, called WeGrowBitcoins, is raising some eyebrows as it becomes more popular, enticing people with a get-rich-quick sentiment. This is causing some to sound off the alarms, accusing the site of being a pyramid scheme.

Also read: In the Next Financial Crisis, What Assets Should You Hold?

We Grow Bitcoins: Scam or Legitimate Operation?

The New Zealand- based news outlet Newshub did an investigative report on the matter, with their investigation centering around truck driver and investor Daniel TepaniaNew Zealand bitcoin scam.

According to Tepania, he he got involved with the organization because it sounded like a good way of making money despite it being only about a month old.

The site promises up to NZD $200,000 (approximately USD $140,000) in profits, but the problem is that it depends on more and more people joining the scheme, making some weary of the site.

The money model works like this:

You make a donation of 0.1 BTC to the site, then you get 5 other people to sign up as well — having them donate the same amount to you. Next, you continue to pay a little bit more to reach higher levels, pay in a bit more and 25 “associates” donate to you and once more to reach level 3 where 125 people will then donate to you.

All in all, this exponential increase in associates can eventually land you about 62 bitcoins a month

Consumer Law Specialist: New Zealand Business “A Simple Scam”

When Newshub asked the country’s commerce commission about the matter they responded by saying that they had not yet received any complaints involving wegrowbitcoins.com, but referred them to its definition of a pyramid scheme anyway.

As it happens, the commission’s legal definition of a pyramid scheme fits with most people’s intuitions as well as describing the site’s model quite well.

It says a pyramid scheme is one that “offers a financial return based on the payments made by new recruits”.

Prajna Moodley, a consumer law specialist, thinks it’s just a simple scam, justifying his claim by pointing out that it “involves investing money and never hearing from the company again.”

He also goes on to say that the company’s address looks generic, 1234 street, Amsterdam and generic Gmail addresses or .RU email addresses, which are Russian.

Even more suspicious, the web site owner — who NewsHub identifies as “Charles Wurster from Texas” — is very difficult to get in contact according to Moodley. He says the only way you can even try to contact him is via Email.

According to Newhub, We Grow Bitcoins currently has a membership of 1300 people and is still growing.

What do you think of the We Grow Bitcoins, is it a scam or something more benign? Let’s hear your thoughts.


Images Via Popular Fortune and SPOT

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