Optioment: How European Authorities Handled a Crypto Ponzi Scheme

A cross-border scam flying under the radar may have affected more than 10,000 European investors.

The Austrian authorities are investigating a cryptocurrency pyramid scheme, after receiving thousands of complaints from private investors that they were the victim of an exit scam from a company named Optioment.

The shakedown in Bitcoin prices had one positive effect: within weeks and days, it destroyed several lending schemes with a pyramid structure, as the sliding BTC price meant they had less access to fresh money.

Davor Coin Fell Apart, While Denying Until the Last

In the case of Optioment, however, the damage was already done. The scheme focused on the European market, and its profile was much lower compared to BitConnect. Yet after the scheme folded in November 2017, the losses were estimated at around 20 million Euros. According to reports from German media, the losses may be much higher, upward of $115 million. In January, the complaints started to mount.

Optioment, which has since pulled its site, offered a rather simple approach: invest Bitcoins, receive 2% weekly interest. The referral program had four layers with rather low referral commissions, but still enough to create a pyramid effect. The scheme was promoted on live events with hundreds of participants.

Joining the Cult

What was curious about Optioment is that it did not rely on social media, and has no Twitter presence. There was also no mention of a crypto coin or another form of digital asset. The scheme had a comparatively low profile, especially in the era of BitConnect and Davor Coin.

This meant that the scheme did not target the most active and savvy people in the crypto community. According to German media, the organization had a cultish quality and presented itself as a legitimate investment fund established in Costa Rica. The rationale behind only taking Bitcoins was to ensure anonymity.

As a result, the "fund managers" may have taken away as much as 12,000 BTC.

"People are selling their cars, some are taking up loans," said one report on Optioment.

A woman told Die Zeit publication that her family lost everything. She'd bought 50 BTC to invest in Optioment, at a cost of around 375,000 Euro. An investor from Vienna personally brought in 200 new buyers into the scheme.

"It felt like a cult, they also made games, asked everyone to get up and close their eyes, then they said, 'Can you feel it? This feeling that comes over you? ' In between, they mentioned the deposit insurance," said one woman who lost around 10,000 Euro to the scam.

The Austrian press believes that three locals were behind Optioment's initial spread to Austria, Germany, and Switzerland. Local media also reported that the scheme had built a layer of 50 "Diamond Traders", who were preparing to spread the scheme to Poland, Romania, and as far as the Balkans.

In the case of Optioment, the rather liberal attitude of authorities on Bitcoin has played a bad joke on Europeans. In the EU, the case was handled by the Interpol, as a criminal case.