A young man involved in marketing crypto mining equipment in Hong Kong has been accused of participating in a scam which may have cost investors millions of dollars.
Wong Ching-kit, who is otherwise known as the “Coin Young Master”, is an administrator of various social media groups designed to promote crypto usage and deliver information about coins.
He stands accused of wrongly persuading investors to purchase mining equipment for a coin he had designed named “Filecoin”.
In a common hallmark of cryptocurrency scams, he is accused of informing potential investors that if they parted with their cash, they would see returns within the first three months.
According to industry press, Wong is believed to have pledged to send back invested cash to those affected – but that this has not yet occurred.
Police say that the total loss accrued by four main investors as a result of the alleged scam is around three million Hong Kong dollars. This equates to around £300,000 British pounds, or $380,000 or so US dollars.
It is also believed by police that there may be another nine people who have lost out and who have spoken to relevant authorities in Hong Kong about their experiences. They are believed to have suffered a total loss of around $940,000.
The South China Morning Post is reporting that Wong has posted messages in his own defence.
”I sell mining machines only but am treated as if I have killed people. When they make money, there is no thank you. When they lose money, they call it a scam,” he is believed to have said.
Wong has not yet been charged with any crime. The police investigation continues.
This is not the first time that Wong has been in trouble with the law. In December, he was allegedly behind an incident in central Hong Kong in which a significant sum of money was released over a public space.
It is believed that Wong organised the event, in which 6,000 Hong Kong dollars were dropped off the top of a high rise building in the Sham Shui Po marketplace. In a video, he is seen to make comments about the incident.
He was taken into custody by the local police during the incident and was subsequently released on bail.
Even local politicians have now weighed in on the most recent saga. The deputy spokesman for the Democratic Party and its panel for financial policy, Ramon Yuen Hoi-Man, is believed to have been making attempts to assist those who were affected by the alleged incident.
According to media sources, however, the deputy spokesman supposedly received a threatening phone call. He is also a prime advocate of crypto sector regulation.
He was in part vindicated late last year when financial authorities in Hong Kong announced that they would consider creating a regulatory sandbox.
“The measures announced today allow us to regulate the management or distribution of virtual asset funds in one way or another so that investors’ interests would be protected either at the fund management level, at the distribution level, or both”, said Ashley Alder, Chief Executive of the Securities and Futures Commission.