Bitcoin pyramid schemes wreak havoc on Brazil's 'New Egypt'

Bitcoin pyramid schemes wreak havoc on Brazil's 'N…

Vernita 0 23 2023.07.18 21:40
That year his company´s transactions totaled nearly 10 million reais ($1.8 million), 15 times higher than the previous year as money siphoned in and out of his bank accounts from all over Brazil, according to a federal police report.

The country´s financial intelligence unit also noticed the company - at the time registered as a restaurant - was regularly trading cryptocurrency on online exchange platforms. By 2017, dos Santos was starting to make serious money - and attract authorities' attention.

25, alerted that dos Santos was planning to flee Brazil, federal police raided more than a dozen locations linked to G.A.S., including dos Santos' home where he was found with 13.8 million reais ($2.5 million) and taken into custody.

Agents also found hard drives containing 10 times that amount in Bitcoin, gold bars, jewelry and several sports cars, including a white Porsche Panamera and an electric blue BMW Z4 convertible.

In and around Cabo Frio, where some had seen their friends and neighbors reap rewards by investing their life savings in the cryptocurrency investment firm G.A.S Consulting & Technology, many began to fear the cost of missing out. Brazil became one of the first countries in the world to approve Bitcoin exchange-traded funds, second only to Canada. (AP Photo/Bruna Prado)" class="blkBorder img-share" style="max-width:100%" />





Bathers dive into the waters of Fort Beach in Cabo Frio, Brazil, Wednesday, Dec.

15, 2021. In and around Cabo Frio, where some had seen their friends and neighbors reap rewards by investing their life savings in the cryptocurrency investment firm G.A.S Consulting & Technology, many began to fear the cost of missing out.
(AP Photo/Bruna Prado)

In and around Cabo Frio, where some had seen their friends and neighbors reap rewards by investing their life savings in the cryptocurrency investment firm G.A.S Consulting & Technology, many began to fear the cost of missing out.

In hundreds of pages of documents obtained by The Associated Press, federal and state police and prosecutors accuse dos Santos and his associates of running a sophisticated racket defrauding thousands of small-scale investors who believed they were getting rich off Bitcoin´s steep appreciation. He is now in a Rio jail awaiting trial on charges including racketeering, financial crimes and ordering the murder and attempted murder of two business competitors.

He remains under investigation in the attempted murder of a third competitor.


The case also underscores the fast-growing appetite for cryptocurrencies in Brazil, where years of economic and political crises have made digital currencies an attractive shield against depreciation of the Brazilian real and double-digit inflation.

Then his therapist told him he sold his house to invest in G.A.S., and had been receiving 10% monthly returns for a year. Do Carmo invested 40,000 reais ($7,000) - just over half the money left in his retirement fund.

And Rio de Janeiro has recently said it wants to offer incentives to those paying city property taxes using bitcoins. At the same time, Brazil´s securities regulator was making digital currencies more attractive: It authorized the country´s investment funds to invest in cryptocurrencies in 2018, giving them greater credibility.

Last year, Brazil approved Bitcoin exchange-traded funds, only the second country in the world to do so.

The integration of the IEO launchpad into a cryptocurrency exchange platform like Binance will increase the possibility of higher income because the exchange owner will ultimately make more money.

After all, the IEO launchpad facilitates the token sale of new coins for a set amount of time and stands out from the other listed coins.



Things came to a head on April 28 when Rio federal police, acting on an anonymous tip, seized the 7 million reais at the helipad of the Insolito Boutique Hotel in Buzios, a short drive from Cabo Frio.

A monthslong investigation into dos Santos' business followed.

Federal and state police and prosecutors accuse the firm of running a sophisticated racket defrauding thousands of small-scale investors who believed they were getting rich off bitcoin's steep appreciation.




Gilson Silva do Carmo, an alleged victim of the G.A.S Consulting & Technology, a cryptocurrency investment firm, walks off after an interview in Iguaba Grande, Brazil, Wednesday, Dec.

15, 2021. (AP Photo/Bruna Prado)" class="blkBorder img-share" style="max-width:100%" />

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