MavixBTC, a get-rich-quick scheme feeding off the popularity of crypto assets, was served a cease-and-desist order. The Missouri Securities Division ordered the firm to stop operations based on accusations of dishonest offers.
MavixBTC Hijacked Real Financial Advisor Account
MavixBTC offered fast returns for its investment scheme and was found to offer brokerage and financial advice services without a license. The company was also found to be using the number of a registered investment adviser without their knowledge. MavixBTC hijacked the account of broker Benjamin F. Edwards &Co., a legitimate financial advisor with thousands of clients.
Securities Commissioner David M. Minnick said,
The novelty and promise of quick profits by investing in cryptocurrencies can be enticing to investors… But there are significant, real risks associated with these non-traditional investments, and scam artists are hard at work trying to defraud investors. Always check with our office before you invest.
Local US regulators have been instrumental in stopping some of the most pernicious schemes in cryptocurrency’s history. The states of Texas and New Jersey have kept serving cease and desist orders to multiple projects, including giants like Bitconnect and Davorcoin.
MavixBTC will now have to show the size of its operations, and convince the regulators that the fines and restitutions should not exceed $30,000. At this point, it is unknown how large the scheme was.
Scheme Offered 55% Returns
The MavixBTC scheme promised returns of 55%. The site, which is still up, boasts of having attracted around $1.89 million, a relatively small amount compared to other unregistered ICOs or fast returns offers. Reportedly, the scheme opened on October 10, 2018, and during that time onboarded 51,022 accounts.
Earnings were supposed to come from mining cryptocurrency, as well as bot trading on crypto exchanges. MavixBTC claimed its bots could generate outlandish returns to satisfy its high interest rate payouts. Cryptocurrency mining, however, is still an operation with rather thin margins, even for Bitcoin.
Similar earnings schemes have been proposed by projects like “Bitcoiin2Gen”, spearheaded by none other than Steven Seagal. State regulators have also stopped multiple ICOs, which usually misrepresent their legality and the risk of cryptocurrencies. The fast-earnings schemes are also not targeted to the more skeptical crypto community, but at inexperienced investors looking for appealing offers.
What do you think about schemes like MavixBTC? Share your thoughts in the comments section below!
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