From exchange hacks to propped-up ICOs to shady investor plots, Ponzi schemes in cryptocurrency markets have been layered to swindle billions of dollars from gullible investors, and in some cases, have succeeded.

A recent report by Longhash highlights three such scams and their valuation with reference to the top-10 coins. Onecoin, Bitconnect, and GainBitcoin were used as the standards for the scams in the cryptocurrency market.

Onecoin, hailed as the “gold standard of Bitcoin-based Ponzi schemes,” amassed a whopping $3.8 billion. The project was titled a “fake cryptocurrency,” with “no utility” that was traded on a Onecoin website with doubts over an actual blockchain for the cryptocurrency.

Bitconnect was based on offering over 40 percent monthly dividends to those holding the Bitconnect token. As per the FBI, Bitconnect siphoned between $2.5 billion to $3.5 billion from its victims, placing the scam firmly in CoinMarketCap’s top-10.

GainBitcoin does not come anywhere close to Onecoin and Bitconnect, taking only $300 million in scammed-valuation. On the premise of cloud mining and incredible returns based on GBMiners mining pool and the MCAP token, the man behind the scam, Amit Bhardwaj, paid $1.5 million in bond to get bail.

Source: Longhash

Longhash charted the scams in reference to the top-10 and revealed that Onecoin would rank 9th, while Bitconnect would take 10th , with GainBitcoin ousting BitTorrent [BTT] to take the 32nd spot. With reference to the same, the report read,

“In reality, this sort of comparison likely underestimates the financial impact of these three scams, as pumping the market cap of a coin created out of thin air would likely lead to a larger number than what is indicated by the revenue generated by these scams.”

In hindsight, the fact that these scams can amass more in market cap than projects like Stellar Lumens [XLM], which is working with IBM on banking solutions, should be concerning for the larger crypto-industry. Longhash eludes to the same, stating that this relativity should provide perspective as to how many virtual currency projects bring “actual value and utility,” to the blockchain space.

The report concluded,

“With cryptocurrencies, a project’s coin will still retain value even if there are no new rubes coming into the scheme. In this way, there’s no point at which the project is officially dead or has failed.”

The post Cryptocurrency Ponzi schemes amassed billions in siphoned funds, equal to several major coins’ market caps, finds report appeared first on AMBCrypto.

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