Ethereum-Based Scam Exposed: $14M Crypto Ponzi Scheme Unraveled
The Rise and Fall of FINTOCH
FINTOCH, a platform that promised lucrative returns, lured investors with the allure of 1% daily profits. The platform falsely claimed to be backed by Morgan Stanley, a tactic designed to instill confidence and attract unsuspecting investors. However, the house of cards collapsed in May 2023 when the platform executed an exit scam, leaving investors in the lurch.
The Role of Ethereum and Other Cryptocurrencies
The FINTOCH scam primarily involved Ethereum and USDT (Tether) on the Tron and Ethereum blockchains. On-chain analyst ZachXBT traced the rug pull to a staggering $31.6 million in USDT, marking it as one of the largest DeFi exit scams of 2023. This incident underscores the need for vigilance and due diligence when investing in Ethereum-based projects and other cryptocurrencies.
Red Flags and Warning Signs
Several red flags were evident in the FINTOCH scam. The promise of 1% daily returns was a clear indicator of a Ponzi scheme, as such high returns are unsustainable in the long run. Additionally, the use of a paid actor as a fake CEO and the false claim of backing by a reputable financial institution like Morgan Stanley were blatant attempts to deceive investors. These warning signs should serve as a cautionary tale for anyone looking to invest in crypto projects.
Protecting Your Investments in the Crypto Market
To safeguard your investments in the volatile crypto market, it is crucial to conduct thorough research and due diligence. Verify the credibility of the project team, scrutinize the whitepaper, and look for transparency in the project’s operations. Additionally, diversifying your portfolio and using secure wallets can mitigate risks. Staying informed about the latest developments in the Ethereum ecosystem and the broader crypto market is also essential.
The arrest of Liang Ai-Bing in connection with the FINTOCH scam serves as a stark reminder of the risks inherent in the crypto market. As investors, it is our responsibility to remain vigilant and informed. By staying updated with the latest Ethereum news and conducting thorough research, we can better protect our investments and navigate the complexities of the crypto landscape. Always remember, if an investment opportunity seems too good to be true, it probably is.
Published: October 30, 2025
