Chainanalysis, a blockchain analysis company’s most recent crime report, has indicated that MTI (Mirror Trading International) is 2020’s hugest cryptocurrency fraud. Chainanalysis made this summation following an investigation, which discovered that MTI had made $589 million from over 471,000 deposits. The report says that MTI’s windfall is much higher compared to J-enco’s or Forsage’s, the next hugest frauds. The two frauds each generated less than $350 million.
More victims in South Africa
In the meantime, Chainanalysis analyses MTI briefly and indicates that over 50% of MTI’s web traffic came from South Africa. However, Mexico, Canada, the U.S., and the United Kingdom all consist of almost 1/4 of the other web traffic. The Blockchain analysis company concludes this information and says that ‘majority of the MTI victims originate from these states in the same numbers also.’
In a different scenario, the report from this blockchain analysis company also discovered that the BTC, which MTI received mainly originated from exchanges.’ What is known as ‘self-hosted wallets’ were utilized also. The report gives details about how MTI turned to utilizing a famous gambling service to steal investor money. The report says:
Maybe what is most fascinating is how MTI Club seems to use a well-liked cryptocurrency gambling service as a method of stealing cash and money. The platform presents the most significant dangerous destination of MTI money in terms of amount, having obtained cryptocurrency worth $39 million from the 2020 fraud.
Dovey Wan, a venture capitalist noted that using these gambling platforms has turned into a ‘prevalent cash stealing method for most cybercriminals who utilize cryptocurrency.’ The reason is that the same as mixers, gambling platforms can be utilized to hide where illegally-gotten money originates from and goes.’
How MTI enticed its victims
As news.Bitcoin.com reported, MTI managed to entice innocent victims by guaranteeing 0.5% continuous daily returns. This return rate would convert to ‘annual profits of 500%.’ MTI’s website indicated that these high profits were assured by ‘its foreign trading software powered by AI).
But, the impractical guarantees from MTI soon resulted in fraud accusations. At first, MTI executives refuted accusations that they ran a multi-level marketing fraud after U.S. and South Africa regulators attacked the firm. Sometime following the raiding of some MTI executives’ homes by FSCA (Financial Sector Conduct Authority), reports arose that investors did not withdraw their money. Due to mounting pressure, Johann Styberg, the CEO eventually took off with investors’ money. In the end, it made MTI collapse.
Meanwhile, the crime report from Channalysis concludes that the MTI fraud presents a good illustration of the reason the sector should make it public knowledge that algorithmic trading platforms that guarantee incredibly high profits are almost always frauds.’ The report adds that cryptocurrency exchanges and other services should ‘stop users from sending money to those addresses, or at least caution them that there is a high probability of financial losses.’