"We'll give you arbitrage profits from cryptocurrency exchanges"... Financial Supervisory Service warns about Ponzi schemes

The Financial Supervisory Service has issued a consumer alert regarding illegal virtual asset operators who claim to generate profits through arbitrage between cryptocurrency exchanges using artificial intelligence (AI).

According to industry sources, on the 7th, the Financial Supervisory Service issued a 'caution' consumer alert warning investors to be wary of illegal virtual asset operators who entice investors by claiming they can earn high returns through arbitrage trading that exploits price differences between cryptocurrency exchanges.

According to the Financial Supervisory Service, Company A introduced itself as a fintech company based in California, USA, claiming to have obtained a license from the US Treasury Department, and promoted a new business. They receive virtual assets through Company A's website, promising to generate profits through arbitrage trading and pay daily returns of 1.8∼4.6%.

In particular, it was found that the investment scale is increasing as they recruit in a multi-level structure, paying differential bonuses based on the number of recruits and scale.

The Financial Supervisory Service explained, "Such companies may pay the promised returns initially, but there is a high possibility that they are Ponzi schemes (recycling funds) that use new investment funds as resources," adding, "The risk of investment loss is high, so financial consumers need to be especially cautious."