Scams are nothing new in the world of cryptocurrency, but they are extremely rare when it comes to “mining” Dogecoin, the world’s most famous meme coin.
Scammers have managed to defraud potential investors out of $119 million in Turkey, according to local media reports. The scammers promised investors significant returns on their Dogecoin mining investments, and they delivered on their promises.
According to Turkish news channel NTV, the alleged scammer, known only as “Turgut V,” and his crew convinced customers in Turkey that they would receive 100 percent returns on an investment in Dogecoin mining equipment if they made the investment.
Similarly to Bitcoin, the process of mining Dogecoin involves an energy-intensive procedure known as “proof of work” in which high-powered computers compete to solve complicated math problems, with the winner earning a reward in the form of cryptocurrency.
As reported by the media, Turgut V conned unsuspecting investors into purchasing Dogecoin and handing it over to him so that he could invest the money in mining technology.
The report also stated that the alleged victims’ attorney had filed a complaint with the Chief Public Prosecutor’s Office in the Istanbul suburb of Küçükçekmece, where Turgut V resides.
Turgut V and several other individuals assured investors in-person at luxury residences and via Zoom calls that they would generate enormous profits, according to the investigation, which used the lawyer as an example.
However, according to sources, the system was then abruptly shut down, and Turgut V vanished without a trace. According to accounts, over 1,500 people fell prey to the alleged swindle. One victim informed NTV that “the system worked for four months” and that “everything was going smoothly at that point.”
Turgut V and his accomplices have been barred from leaving the country, according to NTV, as officials examine their involvement.
Dogecoin is the eighth most valuable cryptocurrency in the world, with a market capitalization of $35.4 billion. According to billionaires Mark Cuban and Elon Musk, who have invested in the cryptocurrency since its inception as a joke in 2014 to poke fun at Bitcoin, it has now gained actual worth.
Cryptocurrency frauds are getting increasingly widespread. Scammers in the United Kingdom duped customers into investing in a bogus Binance Smart Chain service in August, making off with $22 million in cryptocurrency.
When it comes to investment fraud, celebrities’ names and likenesses are frequently used to deceive people into believing their investments are legitimate.
For example, $2 million was stolen in two months last year in a scam that tricked people into sending Bitcoin to accounts that falsely claimed to be owned by SpaceX and Tesla founder Elon Musk.
Musk, incidentally, is intimately affiliated with the cryptocurrency Dogecoin, which has garnered a great deal of attention over the course of the past year.
Since October 2020, the price of the meme coin has increased by 10,000 percent, and most of this increase can be attributed to Musk, who frequently tweets about Dogecoin. In May, he appeared on Saturday Night Live and talked about bitcoin and other cryptocurrencies.
Dogecoin even has its own foundation, which is dedicated to transforming the cryptocurrency into a fully-functional and widely accepted payment system. The Dogecoin Foundation’s advisory board includes Vitalin Buterin, co-founder of Ethereum, and Jared Birchall, a representative of Elon Musk’s venture capital firm.