A Chinese court is presently overseeing a case involving a Chinese Filecoin mining company and its four executives who are accused of orchestrating an $83.3 million pyramid scheme.
Court Case Against a Chinese Filecoin Mining Firm
A Chinese court is presently overseeing a case involving a Chinese Filecoin mining company and its four executives who are accused of orchestrating an $83.3 million pyramid scheme, according to the court's announcement.
The Shenzhen Shikongyun Technology case, which is being heard in Pingnan county, Guangxi autonomous region, is concentrated on the company's founder, Lai, as well as three other executives.
According to the prosecution, the defendant solicited consumers under the guise of a FIL currency mining platform, convincing them to participate by leasing mining equipment or paying fees for mining equipment.
The defendants allegedly exploited the allure of significant returns, attracting more participants and misleading them into accumulating assets, which disrupted economic and social stability. Prior to being shut down by Chinese authorities in May 2022, the company had established platforms like filpool.io and bpool.io and launched a website with the domain ipfs.cn to inappropriately promote its services. The company had managed to acquire over 606.95 million yuan (approximately $83.3 million) through these platforms.
An ex-employee of Shenzhen Shikongyun disclosed that the business was aware of the legal concerns involved in operating on the Chinese mainland and intended to grow internationally. The executives' arrests last year, however, put a stop to these ambitions.
This comes as Hong Kong is actively supporting crypto and Web3 businesses, after China has outlawed all cryptocurrency transactions on the mainland in September 2021.
