Inventory of "dead" blockchain projects in 2019: the peak of funds running in March

Text 丨 Interlink Pulse Academy, the original title "Interlink Annual Report | More than 70 Blockchain Projects of" Death "in 2019: March Capital Market Runs at the Peak and the Exchanges Roll Up at the End of the Year"

"The per capita loss caused by virtual currency fraud in 2019 is as high as 130,000 yuan."

A few days ago, the "2019 Online Fraud Trends Research Report" released by 360 Hunting Network showed that the per capita loss caused by virtual currency fraud in 2019 is the highest among all types of financial fraud. The crime situation of virtual currency can not be underestimated.

In view of this, in 2019, our government's illegal projects in the field of blockchain can be described as heavy blows. Under the strong supervision, many exchange projects and fund disk projects for the purpose of ring-money failed to survive 2019, or ran on their own, or were investigated and seized by government departments.

Mutual Chain Pulse has conducted statistics on more than 70 wallet-type fund disk projects, exchange projects, and pyramid schemes that have "dead" in 2019. The death time and life cycle have been combed. It can be observed that March is the peak running period of wallet funds, and the end of the year is the "death season" of the exchange.

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In addition, the mutual chain pulse is concerned that as of 2019, the long-running and widely-spread MLM coin projects such as cloud payment and FC points in the blockchain field; "benchmark" pseudo-blockchains such as Qubu and ICC Projects have fallen. Among them, nearly 40% of the projects closed due to government investigations, and there seems to have been a lot of progress in the "de-fraud" work in the domestic blockchain field.

"Dead" Blockchain Projects in 2019: 70% of operating less than one year in December is the peak period of running

According to the number of monthly "dead" blockchain projects counted by Interchain Pulse, in the first half of 2019, March was a small "death" peak. In a single month, a total of 5 projects ran and were investigated by the government. These projects are mostly wallet-type funds: March 11, the Sumtoken project runs; March 20, the DOGX wallet runs; March 21, the SuperToken wallet is suspected to run; March 23, the WoToken wallet Run away …

(Drawing: Interlink Pulse Academy)

Inter-chain pulse analysis, wallet-type funds disk projects in March were not unrelated to the strengthening of supervision. On March 22, the Beijing Mutual Fund Association issued a notice on "Precautions against Risks of Illegal Financial Activities in the Name of" Virtual Currency "," ICO "," STO "," Stable Currency "and other variants", reminding consumers to guard against the use of virtual Illegal financial activities under the name of currency and blockchain.

At the same time, the governments of Beijing City, Hebei Province, and Ganzhou City in Jiangxi Province are also reminding the public to be aware of blockchain fraud. In February before this, the Supreme People's Court stated that: the illegal fund-raising has shifted to virtual currencies, and the People's Court will further increase its crackdown; the Deputy Minister of Public Security pointed out that cracking down on illegal fund-raising crimes, focusing on virtual currencies and other fields.

But in the first half of the year, the peak of blockchain project deaths in March did not exceed five, and the number of deaths in the second half of the year climbed from month to month, reaching a peak in December, with a total of 17 deaths. The mutual chain pulse further observed that in December, nearly 30% of the deaths of blockchain projects were due to government investigations, and the rest were running or shutting down by themselves. These 17 projects include not only exchange projects, but also pet-raising game projects and mining projects.

Similarly, the "death wave" of blockchain projects at the end of the year is also closely related to regulation. After the "1024" speech, the government strengthened its support for blockchain technology, and at the same time paid special attention to the crackdown on fraudulent projects that borrowed the name of blockchain.

In November 2019, China issued a block chain supervision notice intensively, and the Joint Office of the Africa and Africa pointed out: Be wary of illegally raising funds in the name of the block chain, and the public will report rewards. . Local governments have also introduced more detailed and enforceable regulatory policies.

(Tabulation: Interlink Pulse Academy)

On November 15, the People's Bank of China's Shanghai Headquarters Mutual Funds Remediation Office and the Shanghai Financial Stability Liaison Office jointly launched a reorganization of virtual currency trading venues in Shanghai's jurisdiction. Subsequently, Beijing and Shenzhen also began to reorganize virtual currency activities. On December 18, Shenzhen's regulatory authorities interviewed eight suspected currency issuers. In the second half of the year, Beijing, which had little regulatory policy information, also proposed to crack down on virtual currency transactions and prevent "virtual currency" trading activities in November and December.

In addition, Weihai City, Shandong Province, Dongguan City, Guangdong Province, Taiyuan City, Shanxi Province, Hubei Province, Yueyang City, Hunan Province, and Chongqing have also proposed to prevent "blockchain fraud."

From the "death point", December is the peak period for blockchain projects to run and be investigated. From the perspective of "development line", the life cycle of blockchain projects dying in 2019 is mostly 1 month or 7 months, and the life cycle is shorter. According to the statistics of the inter-chain pulse, among these projects, 29.78% of the projects have been in operation for less than half a year; 70.21% of the projects have been in operation for less than one year.

(Drawing: Interlink Pulse Academy)

Among them, 5 projects have already run out of business after less than one month of operation. For example, the ZBTC Exchange went online in April and ran away more than ten days after it went online. In June, it was reported that the main criminal involved in the case had been arrested by the Sichuan police; the SOXex exchange was even more so. Running away, hundreds of millions of frauds, cashing out 40 million.

In addition, Interchain Pulse is concerned that among the pseudo-blockchain projects that will die in 2019, there are also projects with long life cycles, widespread populations, and large amount of cases involved. Among them, Yunfutong is the longest running blockchain fraud project, which was established in 2015. As of the end of December 2019, the Guangzhou police launched a net collection operation on Yunfutong's suspected illegal fundraising case, successfully destroying the "Yunfutong" mega illegal fundraising criminal gang, and arrested several suspects led by Huang Moumin, running 4 The years-old MLM case has been settled.

The FC points were also established in 2015, and the “One Way to Be Happy” mall (Xibao Coin) was established in early 2017. These two are also relatively long-term developments that have spread to a wide range of pyramid schemes. In 2019, the FC points case will be heard in court. Lu Youxi's case has been publicly sentenced.

Wallet dies in 2019: "originator of the mountain" running away, "largest" arrested

Looking at the funds disk projects that have died throughout the year, Mutual Chain Pulse found that 2019 seems to be the "end-time" of wallet disks (hereinafter referred to as wallet-based capital disk projects).

In 2018, the wallets that deposit and generate interest were very popular in the currency circle, and in 2019, not only in March, a wave of wallets ran successively; in June, the largest wallet disk project Plustoken team was The police arrested it; in September, the earliest ICC project that pioneered the wallet disk model has also run.

(Tabulation: Interlink Pulse Academy)

In June 2019, the Yancheng police cracked the "Plustoken" mega-network MLM case and arrested six suspects. It is reported that as of March 15, 2019, the "Plustoken" platform has more than 1 million members and has collected membership fees of more than 1.3 billion yuan, which is the largest wallet project.

Later in September, the ICC wallet claimed that it had been run on withdrawals due to malicious insults from individual media, and the team issued an announcement half a month later to suspend project operations. In November, a victim broke the news that Jiangxi Xinyu Public Security Bureau caught the main leader of the "ICC Wallet." It is reported that the project was founded in November 2017, and although it is not as large as Plustoken, it is the “originator” of the wallet disk project.

Generally speaking, most of these projects are under the banner of smart brick moving and quantifying the benefits, but they are still essentially fund disks that use the name of the blockchain. Inter-chain pulse statistics, in 2019, 12 projects of this type have run, and 3 have been investigated by the government.

2019 exchange project: the battle for survival has begun

In addition to the Wallet Disk project, Mutual Chain Pulse observed that the project with the highest number of deaths in 2019 is the exchange. Among the more than 70 dead items counted by Interchain Pulse alone, there are 20 exchange items, among which are old-fashioned exchanges and exchanges that have been running for only a dozen days.

According to Coingecko survey data, more than 150 new exchanges appeared in 2018 alone. The competition between exchanges in 2019 is even more fierce. Not only that, under the pressure of supervision, exchanges that only care about accumulating wealth will have a hard time going through 2019.

(Drawing: Interlink Pulse Academy)

The chart shows that the peak period of the death of the exchange is the fourth quarter of 2019, which is also the period of strengthening supervision in Shanghai, Beijing, Shenzhen and other places.

Among them, the BISS exchange died in the beginning of the fourth quarter of 2019. In October, it was reported that some business leaders of BISS were under investigation by relevant departments, and currency stock transactions or illegal money laundering were involved; at the end of November, the Beijing police conveniently cracked BISS. Dozens of criminal suspects were arrested in illegal digital currency exchange fraud cases.

The Coin Fire Exchange was rectified in December at the Shenzhen Municipal Gold Rectification Office. During the meeting, relevant departments jointly interviewed eight Shenzhen “currency-related” companies. It is understood that during the interview, Bingde Blockchain Technology Co., Ltd., the main body of the Coinfire Exchange, was identified as an economic dispute, and the regulatory department required it to return the existing 20 million yuan of the Coinfire platform to users. After the refund, Bingde Blockchain Technology Co., Ltd. no longer has funds to operate, it will dissolve the company on site and suspend business operations.

(Tabulation: Interlink Pulse Academy)

In addition, the mutual chain pulse is concerned that with the large-scale fall of exchanges, some exchanges seem to have started the era of "soft running". On the surface, some exchanges closed on their own and gave users time to exit the platform, but failed to solve the problems of user withdrawals and theft of funds. For example, the Bitker Exchange claimed to have suffered a hacking attack, and after the remediation, it was declared closed due to insolvency, but the user ’s funds were not compensated for the theft of compensation. Currency, but the website cannot be opened.

Another exchange, GGBTC, was exploded in September. It can only be recharged but not withdrawn. Netizens said that this basically belongs to the "soft running road". In fact, the "soft running road" of the exchange, which has to run without showing its ugliness, will hurt users even more. It takes advantage of the user ’s fortunate "platform can still operate" mentality, making it difficult to erupt and defend rights.

"Benchmarking" falls: 2019 pseudo-blockchain project Qubu, Walden block dog dies

If you talk about the hot blockchain scam in 2019, you have to mention "interesting steps", which can be described as a template for mining MLM currency projects, with zero investment as a gimmick, claiming that you can make money walking, and members will be in early 2019 There are more than 20 million people. After it, there are not a few projects that claim to make money walking, running, reading, and sleeping. But in essence, it is still a pyramid scheme project applying the concept of "digital currency".

(Tabulation: Interlink Pulse Academy)

Walking, running, reading, and sleeping are equal to the worthless behaviors of others. Naturally, digital value cannot be generated out of nothing. In August 2019, the "Business License" of Qubu has been revoked, and its business status has been revoked. In October, the Changsha City Industrial and Commercial Bureau opened a case for investigation.

Funstep's flash-like flashing, global highlights, and wisdom crystal also fell in 2019. In May 2019, Changsha City Bureau of Industry and Commerce has launched a case investigation into Hunan Tastom Information Technology Co., Ltd., the main body of the Smart Crystal project. Flash steps and global highlights ran in December.

Another type of "benchmark" project that falls is the blockchain pet-raising game project. Its representative is Walden Block Dog. Later, there are "blockchain zoos" such as bit pigs, block cats, and block fishes, as well as plant-like imitation disks such as mushroom mobilization and Jinsen Buddha.

This type of project has the characteristics of a typical MLM "pulling head", users need to gain income by developing offline. For example, block dogs and bit dogs encourage users to develop others. Bitdog members can get 50% to 20% of the mining revenue of the 2nd to 8th generation offline mining. This form has fully met the characteristics of MLM.

And in 2019, such projects have crashed or been investigated by the government. In August, the blockchain pet game project Walden Block Dog issued an announcement to its millions of audiences, saying that due to the turbulent situation in Hong Kong, customer service work could not be carried out normally. The APP will suspend all activities during the team's relocation to Malaysia. It will reopen until the 16th. This announcement became a precursor to the collapse of the project.

(Tabulation: Interlink Pulse Academy)

Prior to July, BitPig also issued a system maintenance and upgrade announcement. At the end of July, the platform was unable to log in and it was suspected of crashing. Later in August, the platform was investigated by the police.

Blockchain pet-raising games of the same type that are suspected of MLM and fraud, in 2019, have all gone down, in fact, for no reason. In 2017, Ethereum launched the first blockchain pet game, CryptoKitties, and it was a great success.In 2018, domestic Internet giants also launched their own blockchain pet game products one after another, but did not bring good results. Since then, following the model of Ethereum and domestic big factories, MLM and fraud projects have begun to be planned, eventually exploding in 2019, and eventually dying in 2019.

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