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Daily news update: 18th December

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Updated:

“Fake HitBTC” scammers could face jail time

Two brothers who were responsible for a crypto fraud which saw an investor swindled out of $140,000 could face a two year prison sentence.

Jagroop Singh Khatkar and Karanjit Singh Khatkar, from Canada, have submitted guilty pleas over claims that they pretended to be the customer support agency for HitBTC, a legitimate crypto platform.

By doing so, they managed to persuade a 63-year-old woman to divulge the email address she was using as part of her trading account.

They followed this up by stealing 23 bitcoins from her account, which at the time was worth something in the region of $140,000.

It is understood that the victim, who was not named by major crypto news outlets, will receive the money back.

She is also quoted as having forgiven the people who scammed her.

“I feel sorry for them. I have a son that’s 27. I hope they can turn their smarts into something more beneficial”, she is believed to have said.

Court documents claim that the two “did unlawfully, knowingly, and intentionally transfer, possess, and use, without lawful authority, a means of identification of another, knowing that the means of identification belonged to a real person”.

Chinese blockchain app faces illegal fundraising charges

A blockchain-based app in China looks set to be investigated after it allegedly carried out a range of illegal fundraising measures.

Qubu, which is under investigation in the province of Hunan, is a fitness app which is supposedly powered by blockchain.

According to press reports, Qubu offered its users rewards described as “candies” in return for walking 4,000 steps every day over the course of 45 days.

“Candies” could supposedly be sold on in return for cash, and the app claimed that it had been responsible for issuing one billion such items.

However, the “candies” were also described as investment assets, and it was stated to users that they could receive returns as high as 36.8% in the space of just a month or two.

Now, however, there are claims that the app is actually not nearly as blockchain-savvy as it was first described as being – and that it may have in fact just been a fraud.

One investor told a Chinese news organisation that he had invested the equivalent of $2,150 in Qubu.

This comes after the Chinese government announced a major shift in focus towards developing policies which are blockchain-friendly.

In the past, it has described blockchain as a “strategic frontier technology” and encouraged lots of government institutions to act to be blockchain-friendly.

One such example was the 3bn yuan of funding which was given to the Changsha Economic and Technological Development Zone, which is where Qubu was previously headquartered.

However, this latest news suggests that the Chinese authorities still intend to crack down on blockchain fraud wherever they find it.