Hong Kong Bitcoin trading platform vanishes with millions

Hong Kong Bitcoin trading platform vanishes with millions

Summary: As much as 30 million yuan (US$5 million) of investment could be lost in limbo as a Hong Kong-based Bitcoin trading platform vanishes.

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When ardent Chinese Bitcoin investors found that they could no longer access the website of Global Bond Limited (GBL) in the early morning of October 26, it was already too late.

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Hong Kong Bitcoin trading platform vanishes with millions.

One investor under the pseudonym of South American Vicuna organized an online group for the losing traders and told IT Times on Monday that more than 30 million yuan from 500 investors, many of whom sold homes to get in the virtual currency trade, could never be retrieved.

According to the Vicuna, after the GBL's website shutdown, it left only one message, saying that the site was compromised and investors who want to get back their investment data shall transfer money to a designated account. Now all contacts are not responding, and the company office in Hong Kong is as empty as the traders' pockets.

GBL self-proclaimed that the local government had approved virtual currency exchange back on June 8, and lured buyers in with high leverage rate and high yield. However, the too-obvious-to-ignore trading loophole in its trading system raised concerns, but the "always-winning" traders were too obsessed to get out, according to Vicuna.

Vicuna, who is also the administrator of btcmini.net, another Bitcoin trading platform, is now helping victims scavenge evidence, if there was anything substantial.

Many investors in Shanghai tried to ask the local police to investigate but failed. "When I told them GBL's disappearance, the police asked me what is Bitcoin, and how many coin could people buy with one yuan," said an investor to IT Times.

Vicuna said that at the moment victims could only provide screen captures of transfers, account details, and IP addresses, none of which would be useful without police investigation.

First introduced in Japan in 2008, Bitcoin is a digital currency with high volatility. The speculator magnet is generated by a software program and its trading is not regulated by any authority.

Topics: E-Commerce, Emerging Tech, China, Hong Kong

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8 comments
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  • bitcoin...

    as in bit (in the butt) coin.

    classic case of appealing to greed.
    BitBanger_USA
  • the down side to the anonymity of bitcoin

    is that if someone snags your cash, it's much harder (if not impossible) for the police to track down your money and get it back to you
    theoilman
  • Oops

    That's one problem with the system. I'm sure there are others as well.

    Ken Hess will no doubt have something to say about this and should.
    John L. Ries
  • The new

    "...yes officer, plus there also was a priceless Picasso in the trunk."
    MatsSvensson
  • But Bitcoins are the futre of currency.

    "First introduced in Japan in 2008, Bitcoin is a digital currency with high volatility. The speculator magnet is generated by a software program and its trading is not regulated by any authority."

    Which makes bitcoins ripe for manipulation and theft. How can I know those who came up with the mining and other process are being honest with the users and not fleecing the sheep.
    Richardbz
    • Open source

      Bitcoin is open source, so it doesn't matter who wrote it. Every single line of code has been poured over a million times and verified.

      The main problem with bitcoin is that if you don't have an intimate understanding of open source software, distributed peer to peer networks, modern public private key cryptography, and what is referred to as the consensus problem in computing, then you will not understand bitcoin nor its implications nor the breakthrough that it really is. It cannot be fully appreciated or understood by the vast vast majority of the world, similar to the way the internet was a completely foreign concept shortly after its inception. Who really needs such a thing? Why on earth would I trust such a system to do online banking?
      GoodNPlenty333
  • bitcoin in freefall

    Bet the value of that funny money takes a big hit.
    While I feel sorry for those that lost their money, I am reminded of the saying, "A fool and their money are soon parted".

    And I have to say Ken Hess had the timing right on his recent articles.
    darkside6966@...
    • Prices gone up

      Actually, prices are increasing. This has absolutely nothing to do with the validity of bitcoin as a system. This is some guy scamming a bunch of people and taking advantage of the fact that bitcoin is in high demand, and there are only a few reputable exchanges at the moment. Most people who own bitcoin expect this sort of thing to happen from fringe bitcoin services that most bitcoin users have never heard of.
      GoodNPlenty333