Beijing investigates the first case of pyramid selling using blockchain and virtual currency, a technology company was fined and confiscated over 930,000 yuan

According to a report from the Beijing Daily client, the Market Supervision Administration of Haidian District, Beijing, investigated and handled the city's first illegal case of assisting pyramid schemes using blockchain and virtual currency technology, resulting in a technology company being fined and confiscated a total of over 930,000 yuan.

The technology company involved is an outsourcing service provider for a public blockchain, offering support such as operations, market services, publicity and promotion, exchange docking, and maintenance. This public blockchain launched the "Atomic Plan" and "Hathaway Plan," which are centered around recruiting individuals for rebates, using the number of recruited individuals as the basis for rebates, and requiring participants to invest funds to obtain membership qualifications. Despite being aware of the pyramid scheme applications associated with this public blockchain, the involved company continued to provide technical operations, external publicity, and maintenance of virtual currency trading channels, facilitating the flow of funds and the expansion of activities related to the pyramid scheme.

Ultimately, the pyramid scheme activities of this public blockchain were investigated by the public security authorities, the organizers were criminally detained, and the involved technology company was administratively punished with a total fine and confiscation of over 930,000 yuan for providing facilitative conditions.