The Philippines SEC has released an official warning about Bitcoin (BTC) “cloud mining” company Mining City, advising the public to steer clear of the scheme and others like it. Despite the official condemnation, the price of a related cryptocurrency is on the rise.
The warning describes the company as an unlicensed entity in the country and said it was not functioning “in accordance with guidelines for virtual currency exchanges,” stating:
“The aforementioned scheme used by Mining City clearly shows an indication of a possible Ponzi scheme in which new investor money is used to pay ‘bogus profits’ to those who invested first.”
The notice also identified Mining City’s CEO Gregory Rogowski, team leader Anthony Aguilar, and Facebook page admin Jhon Rey Grey as key personnel involved in the scheme — all of whom will also be reported to the Bureau of Internal Revenue for investigation regarding their tax assessments.
The scheme offers cloud mining packages in the form of three-year contracts where hash power is rented to investors worth between $300 up to $12,600, and purports to provide daily returns of up to $92 per day. Mining City operates in partnership with MineBest, creator of the Bitcoin Vault (BTCV) scam, with investors receiving their profits in the form of BTCV tokens.
The regulator told the public “not to invest or stop investing in plans offered by Mining City or by entities that engage in smart contracts, cryptocurrencies or digital asset exchanges that are not registered with the commission,” adding that promoters could be criminally prosecuted with fines over $100,000 or imprisonment of up to 21 years.