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MTI 'Pyramid' Scam - 22K BTC Vanishes - Summarising A Painful Experience

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Quite in line with what many of have been expecting, Bitcoin's been going on a cocaine spree ever since the end of 2020. Hodlers are, naturally, feeling super buoyant. If you are one of them, just imagine for a moment how instead you might be feeling right now if you had had most or all of your BTC taken from you? And what if it was – after all is said and done – nobody's fault but your own, and you realise that you had actually given it away?

It'd be pretty shit huh? I'm glad most of you will not have to experience that sinking feeling in the pit of the stomach, that dull immutability of loss flowing through the veins of over 150,000 folk who had deposited their Bitcoin with Mirror Trading International (MTI), never to get it back. It's even worse for those who got friends and family to invest, based on personal trust.

Sadly, yours truly was one of those down-in-the-dumps 'mugs' whose friend invested $1500 on his recommendation. Total lost by us was a fraction over 0.2 BTC, perhaps not the biggest sum in itself, but it was all we had :(. The friend whose talking about MTI got me interested ended up losing 2 whole Bitcoins!

This obviously isn't a particularly easy post to author as it shows me in a gullible and naïve light as well as opens me up to ridicule. However, I feel that it is an important step in order to put this all behind me. I write these lines without shame, and with that 20/20 vision which magically appeared in the still-glowing aftermath of this particular scam.

I won't go into too many details about the ins and outs (ha ha, there were ins but no outs :). Instead, I'll summarise, personalise and provide some links for anyone interested in reading further.

The MTI Scam In A Nutshell

Mirror Trading International (MTI), a South African company, started 'trading' in April 2009 with Bitcoin deposited by members. MTI offered 9-12% profits on low-value, high-frequency trades. The profits accrued daily, no KYC required and the BTC could be withdrawn at any time, subject to a maximum 2-day period but often available within 12 hours. A summary of MTI is outlined in the image below (taken from https://www.cryptoanalyzer.uk/ via the Wayback Machine).


cryptoanalyzer's summary of MTI

cryptoanalyzer's risk assessment for MTI

MTI's last issued payout statement, showing percentage breakdown for member-types

The CEO, Johannes Steynberg, claimed to have access to a proprietory algorithm that made the trades and which had to be kept secret in order to prevent it being copied. The CEO and his team appeared to be transparent and knowledgable, claiming that what they were doing was providing an opportunity for folk to gain financial freedom. The CEO gave an unscripted interview with cryptoanalyzer (a shill for a number of such schemes, who has since deleted all MTI videos from his account) in which he talked about MTI and came across as convincing and sincere.

Missed Warnings

In August the South African financial regulation authority started an investigation into MTI. Their report was not delivered until later - around the time of the exit scam, but MTI at the time defended itself with vigour. Some, like me, considered that it was to be expected that there were powerful banking interests behind the move and this covered any smell of fish that might've reached my nostrils. The alarm bells that did ring were given benefit of doubt after another very convincing performance by the Head of Marketing, Cheri Marks whose passionate, apparently unscripted defence of MTI fooled me (and many others, including cryptoanalyzer) into thinking they were straight. Had I researched it further with greater objectivity (I wanted them to be straight and this wishful thinking skewed my judgement), I would have pulled out for certain, especially given the amount of feedback available even then.

Things unravelled quickly mid December 2020. MTI issued a statement claiming that the CEO had not been truthful with them, had disappeared and that they didn't know where he was. Nor did they have the keys to the BTC wallet with over 22,000 BTC at stake. The website is still up and running but no withdrawals are taking place and a criminal investigation is being undertaken. The MTI management have since been silent, wiping their social media presences. In all likelyhood they absconded before releasing their statement so as to buy time and to build confusion.

The vision of hindsight reveals that most of the MTI management and BIG earners had previously been involved in the globalBTC scam of 2018. This then, I realised to my bitter horror, was a bunch of professionals who had skilfully taken people for a ride and seem to have exit-scammed with possibly over half a billion dollars worth of BTC (and climbing), surely the largest such haul ever!

Lessons, Silver-Linings, Wound-Licking:

  • had I had more BTC at my disposal, I would almost certainly have lost it too
  • having been stung thusly, I feel that I have been somewhat innoculated against falling for such things in this manner in future
  • I have now really learnt to question received information at a deeper level - not to take anyone's word without personal verification of my own, however 'trustworthy' they may seem – DYMOR!
  • I have learnt that the decision-empowering information IS always out there for those who make an effort to research with an open mind. This is a valuable lesson indeed
  • I am grateful to have taken some 'profits' and converted them into LEO, Hive and Rune before it all went kaput

By stating it publicly on the blockchain I hereby let it all go, able now to resume life in the cryptosphere after a period where I could barely bring myself to even use my daily voting power. I have processed my feelings, including anger, regret and all the 'what ifs' and 'if onlys'. I have pretty much accepted the situation and so has the friend who invested.

My intention now is to wait until Rune pumps against BTC, then trade the 400 Rune earned from MTI profits in order to get my friend back as close as possible to his original position. I'll use a hardware wallet this time and will of course keep away from scams which – as you folk may be thinking, are visible from miles away - “Krunk, how/why the fuck did you fall for that shit?”.

Thanks for reading 🙏 Barge (@krunkypuram)

Links For Further Reading On MTI Scam

Previous LeoFinance-themed artwork by me for anyone to use:

Posted Using LeoFinance Beta