Chinese EOS Wallet Shuts Down with $52M of Customer Funds Disappear

Chinese EOS Wallet Shuts Down with $52M of Customer Funds Disappear

A wallet application that lures investors to deposit EOS with high returns assurance, dubbed EOS Ecosystem, has shut down and probably eloped with relatively $52 million in client funds.

After closer examination of the EOS block transactions, it was discovered that there were no more than 500 EOS left in the balance of one of the EOS Ecosystem related accounts, according to report of local media

On 20th April 2020, the account holder had removed relatively 890,000 EOS. They then tried to further investigate by tracking down some other accounts belonging to the company’s wallet.

It was learned that one of the main accounts had received about 19.36 million EOS that same day from a number of small accounts. Considering the current market price of EOS, the sum is comparatively $52 million. There is a possibility, according to the report, of more funds yet to be uncovered.

Going by suggestion of transaction metadata, the funds may have been transferred to Huobi Exchange. The exchange has, however, promised to help by freezing the funds once they are detected.

According to the report, the scamming activity could have started with a team known as “w.io” under the name ‘EOS Ecosystem.’ They are part of the core team of a chinese crypto wallet based on the EOS network, Starteos, according to what they claimed to be. They probably said this in order to win the unsuspecting public’s confidence.

The report stated that they offered high returns as a bait to trick the crypto-newbies to deposit EOS token into the group’s account via the EOS Ecosystem App.

However, the scam victim reportedly formed a WeChat group at the time of publication to initiate a coordinated legal action, as the only means of fighting back.

It is worth mentioning that, China’s Center for Information and Industry Development (CCID) has published the 17th report on evaluation of the top cryptocurrencies. The center publishes the report once a month to compare the best recognized blockchain projects in the crypto space.

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Abdulhay Mahmoud 414 Articles
Abdulhay Mahmoud is a creative writer with over 15 years of experience in journalism, translation, and investor relations. He has B.A in English and Literature from a reputable University. He recently became a contributor at Cryptolydian.com to fulfill his thirst in reporting digital coins and blockchain-related news, an interest was built over the years.