Fundraising mechanisms and points of caution

###Uncovering the Fraudulent Methods of Fundraising Schemes

Many fundraising schemes utilize blockchain technology to solicit investments. Thousands of new schemes emerge every year, continuously evolving.

These schemes come in various forms. There are large-scale cases that have raised over 20 billion yuan, international frauds that have been deployed across multiple countries for a long time, typical multi-level marketing types, rapidly growing trading platforms, those that have introduced new "resonance" methods, self-created schemes, and even mining equipment-related schemes that became the largest fraud case overseas.

The fundraising scheme is merely a numbers game, a method of raising funds from nothing. It becomes a contest of whether to escape quickly or not. Wrapped in glamorous words such as mutual aid associations, dividends, stocks, points, film revenue sharing, and soccer arbitration transactions, it is essentially nothing more than a Ponzi scheme.

On the internet, there are various methods such as multi-level marketing, direct sales, personal sales, fundraising schemes, and virtual currencies. Many people may encounter one of these. Those who operate fundraising schemes use the term "scheme industry" to differentiate themselves from the virtual currency sector.

There are fixed patterns in fundraising schemes. There are categorized talking points prepared in response to investor questions. Here are some typical solicitation phrases from the most troublesome fundraising schemes. Being aware of these can help reduce the risk of becoming a victim.

Scammers often present a binary choice, saying things like "Trust me and hold on, or step away if you can't believe it," and make extreme promises like "It will be $1,000 by the end of the year, or I will eat shit live on air." They also try to reassure investors with phrases like "The team is active, don't worry about the price," "You won't be able to buy at such a low price again," and "It's just a price adjustment, there will be a big move later."

They claim to have a "top-notch market cap management team" and defend against criticism by saying, "If you don't like it, you can sell; no one is forcing you." They always stir expectations by saying, "There will be good news next month" and assert that "the value of the coin is greatly underestimated." They also show unfounded confidence by stating, "99% of projects will disappear in the future, but our coin will be among the remaining 1%."

They spread unverifiable information such as negotiations with major exchanges, rumors of listings, and partnerships with influential companies, and develop conspiracy theories claiming "the exchange is manipulating prices." While saying "I will take my time to prove everything," they promise unrealistic profits like "you can earn 100 million and 400 thousand yen in two years with a 70,000 yen investment."

Furthermore, they create followers by believing that "simply obeying and executing will lead to success" and enforce information control by suggesting that "it's better not to look at negative information." They make people anxious by saying, "The blockchain industry trains people" and "Opportunities only come once," and brainwash them into thinking that "following the company and the system will lead to a prosperous life."

They mention the names of celebrities such as "Satoshi Nakamoto", "Zhao Changpeng", "Li Xiaolai", "Sun Yuchen", and draw comparisons, telling grand tales like "Decentralization is the greatest technological innovation in human history" and "Blockchain can change humanity." They also make unrealistic promises, such as "A dream price that can increase 100 times", "Monthly interest of 30%", and "Earn just by walking."

Just before a fundraising scheme collapses, tactics such as hacker attacks or system maintenance and upgrades are often used. It usually starts with regular system upgrades, and as investors become accustomed to this, long-term maintenance is conducted under the pretext of data loss due to attacks, buying time for the operators to escape. Even after the group disbands and the operators or administrators disappear, some investors continue to believe in a resumption, but if there is no resumption for a long time, it becomes impossible to resume.

The collapse of fundraising schemes is only a matter of time. Understanding these rhetoric and techniques, and distancing oneself from fundraising schemes is the best choice for investors. It is important to distinguish between blockchain and fundraising schemes. Bitcoin has been circulating in the market for over 10 years, yet the network does not require maintenance and continues to function normally even during upgrades. Blockchain is highly reliable and accessible anytime and anywhere as long as there is an internet connection.