The Philippines Security Exchange Commission (SEC) has recently released an official warning. This warning is regarding Mining City, a supposed “cloud mining” company, and has advised the public at large to stay away from both Mining City and any scheme like it. Even with the official condemnation from the Phillippine regulator, it seems.
Highlighting Mining City’s Misconduct
The warning details a company operating as an unlicensed entity within the country, and the SEC has warned that it’s thus not functioning within the guidelines set out for virtual currency exchanges by the regulator.
The regulator warned that the scheme employed by Mining City shows a clear indication of possibly being a Ponzi Scheme. The SEC highlighted how a Ponzi scheme entails using the money from new investors to pay the misrepresented profits of the first investors, to try and keep the money coming in.
Using The Classic Schemes
Alongside this, the warning also identified three key figures within the scheme, being Gregory Rogowski, the CEO of Mining City, Jhon Rey Grey, the admin of its Facebook page, and Anthony Aguilar, the team leader. All three of these individuals will be reported to the Bureau of Internal Revenue in order to investigate their respective tax assessments, in turn.
The scheme itself involves the offering of a cloud mining package, taking the form of a three-year contract. This entails renting hash power to investors, worth anything from $300 to $12,600. Claims of the company itself stated that it’s possible to earn a profit of $92 a day. It should be noted, however, that Mining City operates with MineBest as a partner, which is the creator of the Bitcoin Vault (BTCV) scam. This involves investors receiving profits by way of BTCV tokens.
Some Strange Developments
The regulator gave warning to the public, urging them not to invest or otherwise stop investing in plans that Mining City offers. Further warnings are not to partake in any entity that isn’t registered with the commission, but engages in cryptocurrencies, smart contracts, or serves as a digital asset exchange. To hammer its point across, the SEC highlighted that these promoters, should they be criminally prosecuted, could see fines of up to $100,000, or otherwise see up to 21 years in prison for it.
However, something strange has occurred. While BTCV saw a price plummet two weeks prior to the warning, going down 76% from $425 to $100 between the 23rd of August and 10th of September, something new is happening. The price has now risen up, going back to $163, which suggests that the warning was either ineffective or, at worst, encouraging the public’s interest in the scheme. On the website of Mining City, it’s claimed that the program can operate even if the site is closed, which implies a decentralized nature, immune to government intervention.