In the world of cryptocurrency, a quietly destructive scam has recently come to light. From SUI, NEAR to Axelar, SEI and dozens of other well-known tokens, all are deeply entangled in this. Astonishingly, this scam has siphoned off more than $50 million from investors within months, and even more surprisingly, it was hardly discussed until recently when it became widely known, with the list of victims including venture capitalists, key opinion leaders in the crypto space, and even heavyweight whales holding large amounts of crypto assets. What kind of meticulously planned 'hunting game' is this? Let us unveil the mystery of this scam.
I. Sweet Bait: The 'Sugar-Coated Bomb' of High-Discount Transactions (November 2024 - January 2025)
In November 2024, the calm OTC cryptocurrency market suddenly experienced a 'spring breeze'. Various venture capital groups and private investment pools discovered a treasure in Telegram groups and launched a series of seemingly legitimate and attractive top-tier OTC trades. They claimed with utmost certainty that they could sell tokens from high-profile projects like Graph (GRT), Aptos (APT), SEI, SWELL at a super low discount of 50% of the market price, but with one condition: investors had to accept a 4-5 month lock-up period.
Initially, many investors harbored doubts; after all, such enticing discounts in the unpredictable world of cryptocurrency always seemed somewhat unreal. However, early participants in the transactions were pleasantly surprised to find that everything went as promised. They received tokens on time, with tangible profits before their eyes, making their initial skepticism dissipate in an instant. This superficial legality and smooth transaction process acted like a powerful magnet, rapidly attracting more and more investors into the fray. Those who had already tasted sweetness became even more confident, not only increasing their investments but also spreading the word in their circles, enticing more people to join this seemingly risk-free 'wealth feast'.
II. Crazy Expansion: The Scam Snowball Grows Bigger (February 2025 - June 2025)
By February 2025, this scam seemed to have been injected with 'expansion agents', beginning to expand at an astonishing rate. A new wave of OTC transactions surged into Telegram groups like a tide. This time, the scale of the transactions became larger and the range of tokens involved also significantly widened, with numerous tokens such as SUI, NEAR, GRASS, Axelar being included. However, the transaction structure still followed the previous 'modus operandi': attractive large discounts paired with fixed lock-up periods.
Faced with such a seemingly familiar and profitable trading model, investors were almost defenseless. Tempted by high profits, they generously opened their wallets and invested substantial amounts into this dangerous game. Meanwhile, the planners of the scam cleverly exploited the investors' greed and trust, causing the scam to snowball uncontrollably, gradually heading toward a mad abyss.
III. Ignoring Warnings: Danger Approaches Unnoticed (May 2025)
As time passed, the carefully disguised scam gradually revealed its flaws. In May 2025, several industry leaders keenly sensed something unusual and stepped forward to issue stern warnings in public forums. Eman Abio from the SUI team earnestly reminded users on platform X to be wary of those fake Telegram OTC transactions, stating firmly: 'There is no such transaction at all!' Coincidentally, Lucian Mincu from MultiversX (formerly Elrond) also came forward with a similar warning.
Regrettably, despite these warnings echoing throughout the cryptocurrency community, they fell on deaf ears, failing to garner enough attention from most investors. Past successful investment experiences, those so-called 'success stories', and seemingly reliable groups participating led investors to be blinded, ignoring the dangerous signals before them. Driven by profit, they continued to pour into new transactions, completely unaware that they were stepping closer to a massive trap.
IV. The Truth Revealed: The Ugly Face of the Ponzi Scheme (June 2025)
June 1 became a turning point in this scam. After the last known transaction involving Fluid tokens was launched, the previously smooth token distribution process suddenly came to a halt. Those investors who were eagerly awaiting their returns were met not with the tokens they were due, but with various vague excuses. 'Travel delays', 'exchange issues', 'KYC (identity verification) problems', the planners attempted to use these unfounded reasons to pacify anxious investors.
On June 19, the venture capital group Aza Ventures, which led these transactions, finally broke their silence and publicly announced that they too were victims of this scam. Aza Ventures angrily accused their primary trader 'Source 1' of operating a typical Ponzi scheme. According to Aza, the early transactions were indeed real, merely 'bait' thrown by the scammers to gain trust. The later transactions, however, completely relied on the continuous influx of funds from new investors to fulfill previous commitments to old investors. This transfer of funds from one to another is the core and ugliest operational model of a Ponzi scheme. What’s even more shocking is that Aza Ventures further disclosed that their other transaction sources 'Source 2' and 'Source 3' were also obtaining transactions through 'Source 1', making the entire transaction chain resemble a complex 'fraud network', with investors deeply trapped and unable to extricate themselves. In an instant, the situation spiraled out of control, plunging into chaos.
V. Tokens Involved: A Long 'Victim List'
The range of tokens involved in this scam is astonishing. Early transactions (November 2024 - January 2025) involved tokens like Aptos, Sei, Swell, Coti, Kava, etc. As for the later transactions (February 2025 - June 1, 2025), the list expanded significantly, with numerous tokens such as SUI, NEAR, Aptos, Sei, Highstreet falling 'victim'. Behind these tokens are the real investments of countless investors, who now find themselves mired in the quagmire of this scam, uncertain if they can escape intact.
VI. Tracking the Mastermind: Who Exactly is 'Source 1'?
Aza Ventures claimed that they had identified the person behind 'Source 1'. According to insiders, 'Source 1' is suspected to be of Indian nationality and is reportedly the founder of a current project listed on Binance. However, it is puzzling that Aza Ventures chose not to publicly disclose his identity but instead opted to pressure him privately, attempting to demand the return of the stolen funds. @AltcoinAlphaOnX has also been continuously posting more updates about 'Source 1' on platform X, and the entire cryptocurrency community is closely watching this crucial lead, hoping to lift the veil on the mastermind and reveal the truth to the world.
VII. Heavy Losses: Investors Fall into the Abyss of Despair
The losses caused by this scam are truly staggering. It is estimated that the total loss amount exceeds $50 million. Many investors suffered severe blows in this disaster, with some having single investments exceeding $1 million. The range of victims is extremely broad, encompassing individual retail investors, large whales in the crypto space, project teams, and even venture capital institutions. For some victims, these losses are not just financial blows but could also alter the trajectory of their lives. Reports indicate that some have fallen into severe emotional collapse due to this incident, with their mental state on the brink of breakdown. This scam has swept through the entire cryptocurrency investment circle like a merciless storm, leaving devastation in its wake.
VIII. Follow-Up Actions: Will Justice Arrive on Time?
In the face of such a severe situation, Aza Ventures claimed that they were actively negotiating with 'Source 1', trying to recover the hard-earned money of investors, setting the end of the month as the final deadline. Meanwhile, the entire cryptocurrency community did not sit idle. Members of the broader crypto community took action, tirelessly tracking relevant wallet addresses, working to identify potential accomplices, and digging up more strong evidence, all in an effort to bring the responsible parties to justice.
This incident undoubtedly sounded a heavy alarm for the entire cryptocurrency industry, making people realize the immense risks involved in conducting unregulated over-the-counter (OTC) transactions through informal channels like Telegram and Discord. Despite obvious warning signs appearing early on, and industry leaders publicly issuing alerts, trust, greed, and so-called social 'proof' caused investors to lose their necessary vigilance, ultimately becoming 'prey' in the hands of scammers. Now, the entire community is eagerly awaiting justice to be served, hoping that those who suffered significant losses can eventually receive the refunds they deserve, and that this 'nightmare' in the cryptocurrency realm can come to an end.
Disclaimer: The content of this article is for reference only and does not constitute any investment advice. Investors should rationally consider cryptocurrency investments based on their own risk tolerance and investment goals, and should not blindly follow trends.
