With the worldwide growth of the Crypto industry, the rate of illegal cryptocurrency mining has also been on the rise. Most recently the Philippines securities regulator or the SEC, has uncovered what it claims to be a pyramid scheme dubbed Mining City, that promises customers returns of up to $92 daily, paid out in Bitcoin Vault tokens.
According to an official warning issued by The Philippines Securities and Exchange Commission, the supposed “cloud mining” company Mining City, is being described as an unlicensed entity in the nation as it is not registered with the SEC and doesn’t operate “in accordance with guidelines for virtual currency exchanges.”
“The aforementioned scheme used by Mining City clearly shows an indication of a possible Ponzi scheme in which new investor money is used to pay ‘bogus profits’ to those who invested first.”
The release notes that Mining City’s CEO Gregory Rogowski, team leader Anthony Aguilar and Facebook page admin Jhon Rey Grey are the supposed master minds behind the scheme and, hence, will be reported to the Bureau of Internal Revenue for investigation regarding their tax assessments.
Mining city’s cloud mining packages offers customers rented hash power within a three-year contract for prices ranging between $300 for 3 Tera Hashes per second, up to $12,600 for 138 TH/s, and promises up to $92 in daily profits.
The company operates with MineBest, creator of the Bitcoin Vault scam, and investors receiving their profits in the form of BTCV tokens.
On this note, the regulator has warned the public “not to invest or stop investing in plans offered by Mining City or by entities that engage in smart contracts, cryptocurrencies or digital asset exchanges that are not registered with the commission,” warning that promoters of this scheme could be criminally prosecuted and fined with $100,000 and imprisonment of up to 21 years.
Besides the Phillipines, Mining City is also active in Japan, South Korea and Vietnam. Despite the allegation, the firm hasn’t provided any evidence of being registered in any of these jurisdictions.
However, the Mining City website states that the program will continue to operate despite the website being taken down, courtesy of the decentralized nature of operations.