Crypto Wars: Faked deaths, missing billions and industry disruption

Imagine a world where anyone with a computer and a few hundred dollars could create their own digital currency overnight. This was the reality of the cryptocurrency boom around 2017, a time when the market was akin to a Wild West frontier—full of promise but riddled with lawlessness. The initial coin offering, or ICO, became the new gold rush. It offered an unprecedented way for startups to raise millions without the traditional hurdles of equity dilution or regulatory scrutiny. ICOs were easy to launch, often outsourced to freelancers on gig platforms for mere hundreds of dollars, enabling thousands of projects to flood the market. Some projects were as blatant as calling themselves 'PonziCoin' or 'ScamCoin', openly admitting their nature yet still managing to rake in investor funds. Others hid behind slick marketing, fake teams, and borrowed celebrity images to lure in hopeful investors chasing the dream of quick riches.

The hype was intoxicating. People saw early Bitcoin investors become millionaires and wanted their slice of the pie. Fear of missing out, or FOMO, drove a buying frenzy where rational skepticism was overshadowed by dreams of wealth. Marketing strategies included paying 'bounty hunters' in worthless tokens to spread the word, effectively outsourcing promotion at no upfront cash cost. The market swelled to an astonishing $1.8 trillion, yet beneath the surface, the majority of these projects had no real value or use case. Many were outright scams designed to disappear with investors’ money once the bubble burst.

Despite the chaos, some ICOs did lead to genuine innovation, but they were the exceptions in a landscape dominated by opportunists. This explosive period set the stage for the scams and crashes that followed, illustrating both the potential and peril of unregulated financial innovation. As we move forward, we will delve into the darker tactics scammers employed when they decided to vanish with their ill-gotten gains, and how unsuspecting investors were left in the lurch.

Let's now explore how these exit scams unfolded and the human stories behind them.