BTC Global ceased paying withdrawals to its clients on January 29, 2018. The site completely suspended its activities on February 18.
Over 27,500 people were scammed by BTC Global, including Americans, Australians and South Africans. It has been estimated that they lost over $80 million was lost when they transferred their bitcoins to BTC Global’s e-wallet to buy into Twain’s investments.
At least 87% of the traffic to the BTC Global website came from South Africa. Given that statistic, South Africa’s Directorate for Priority Crime Investigation, popularly known as the “Hawks,” has confirmed that its Serious Commercial Crimes Unit is investigating their claims.
BTC Global was launched on September 25, 2017. It was said to have been founded by a Steven Twain, who supposedly had six years of experience “trading binary options with consistent success.”
A Facebook page for Steven Twain, which was removed once the scam collapsed, claimed that he lived in New York City and attended Miami Dade College.
International searches for Steven Twain, however, have not produced any concrete leads. No one with that name has been found to have had a trading history on any public exchange. It is assumed, therefore, that Steven Twain was a pseudonym, and his investment prowess was nothing more than a marketing gimmick to convince inexperienced investors to fork over their money before he disappeared with it.
In mid-2017, Twain advertised a bitcoin investment that supposedly yielded 10% weekly on a South African website. At more or less the same time, someone using the name of Henry Obianyo was suspiciously promoting a 10% weekly ROI on Facebook using Steven Twain’s contact details.
The consensus is that BTC Global was a Ponzi scheme that collapsed from its own weight.
The platform featured what it called an “exclusive” tiered structure. Theoretically, each “affiliate” required a referral from an existing one to join the platform. In practice, however, anyone who wanted to sign up was allowed to do so. That was the first scam.
Twain claimed to provide 40% returns on a weekly basis for investors of $10,000 on up. That was patently impossible. Since the world’s best hedge funds generate returns of about 20% per year, how could BTC Global beat every other investment company on the planet? That was the second scam.
Nonetheless, the site guaranteed weekly interest rates of 14%. Even legitimate binary options brokers, however, don’t generate 14% a week on returns for their clients. That was the third scam.
Daily earnings, automatic reinvesting, and “complete transparency on investments” were promised as well. Despite that promise, BTC Global did not specify what it was investing in. There was no specific description at all of its products or services. Did it invest in stocks? Commodities? Forex and other CFDs? They never said and their clients never knew. That was the fourth scam.
Twain also guaranteed 5% per week on the U.S. dollar value of bitcoin deposits. That was the fifth scam.
An online “Knowledge Base” landing page supposedly contained “numerous support references, created by our support professionals who have resolved issues for our customers. These articles are constantly updated, expanded on and refined to ensure that you have access to the very latest information.” No such links were provided, however. That was the sixth scam.
No support mechanism was necessary since clients did not personally engage in trading and entrusted all their investments to Twain, who alone controlled their funds.
BTC Global was unlicensed.