Crypto Regulators From 5 Countries Identify A Potential $1 Billion Ponzi Scheme

In recent months, investing in cryptocurrencies has been challenging. The emerging market has been shaken by radically shifting prices, collapsing assets, and a variety of economic challenges.

Since November, as the price of bitcoin, the most popular cryptocurrency in the world, has declined, so have the values of currencies that were once considered safe and secure because they were pegged to the US dollar and regulated by exchanges.

Digital asset proponents applauded the international and national authorities’ efforts to better appreciate and monitor the sector’s viability.

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Also contributing to the growth was the senseless Russian invasion of Ukraine. In and out of the country, a large number of individuals used cryptocurrencies to transfer funds, demonstrating once again the currency’s utility.

Regardless of its shining moments, cryptocurrency is currently at a crucial juncture.

It has lost almost fifty percent of its market value since November and is susceptible to frauds, manipulations, and sudden decreases.

Regardless of its bright spots, Bitcoin and other digital assets are currently at a crossroads. (Inc42)

Tax Investigators Keeping Eye On Big-Time Fraud

Now, regulators are investigating yet another fraud.

More than 50 potential crypto tax offences have been uncovered by international tax inspectors, which may pave the way for an official probe in the coming weeks — including a possible $1 billion Ponzi scheme.

According to reports released on Friday, the heads of tax enforcement from the Joint Chiefs of Global Tax Enforcement (J5) countries gathered in London this week to share intelligence and data to uncover sources of unlawful cross-border activity.

On Friday, Jim Lee, the Internal Revenue Service’s chief of criminal investigations, stated, “Some of these leads concern individuals with substantial NFT transactions involving potential tax or other financial crimes throughout our jurisdictions.”

The money involved appears to have affected investors worldwide, including buyers of cryptocurrencies in Australia, Canada, the United States, the United Kingdom, and the Netherlands.

“It looks that [one] is a $1 billion Ponzi scheme. That’s billion with a ‘B,’ and this lead affects each and every J5 nation,” Lee remarked.

The J5 is a tax-crime-fighting program involving the governments of five nations.

Crypto total market cap at $1.25 trillion on the daily chart | Source: TradingView.com

The program emphasizes the increased examination of hazards, fraud, and wrongdoing in the burgeoning cryptocurrency business.

Last Monday, US Treasury Secretary Janet Yellen informed legislators that the collapse of the TerraUSD stablecoin demonstrates the need for additional laws.

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J5 Vs. Crypto Crime Enablers

The J5 was founded in response to the Organization for Economic Cooperation and Development’s (OECD) call on countries to do more to combat tax crime facilitators.

The Internal Revenue Service Criminal Investigation (IRS-CI), Australian Taxation Office (ATO), Fiscale Inlichtingen- en Opsporingsdienst (FIOD), Canada Revenue Agency (CRA), and HM Revenue & Customs make up the organization.

The Dutch Fiscal Information and Investigation Service’s Niels Obbink stated, “NFTs are one of the emerging digital methods of trade-based money laundering.”

The identification of suspected crimes represents additional bad news in a turbulent week for Bitcoin markets.

According to some estimates, large price volatility roiled crypto markets and lowered total asset valuations by around $270 billion.

Featured image from InsideBitcoins, chart from TradingView.com