Blockchain General News

Upbit launches reward system for spotting fraudulent multi-level cryptocurrencies scheme

It appears that nobody wants to take to chances. While the governments and the regulators around the globe are not sparing any efforts to tighten their rules, South Korea’s cryptocurrency exchange, Upbit, has taken a significant step. The exchange indicated its readiness to reward users if they spot any fraudulent multi-level schemes in respect of the digital currencies. Already, it could identify about 20 schemes and complain to the police.

Steps to Prevent Fraud

Upbit is the biggest cryptocurrency exchange in South Korea and showed keenness in preventing the fraud especially in initial coin offering (ICO) tokens. For this, the exchange has invited every user to make use of the new system of reward that is aimed at preventing and spotting multi-level and illegal scams of dealing in digital currencies. The exchange’s move would not be surprising considering the tightening of regulations around the world.

In its recent announcement, Upbit cited the increasing level of frauds that included Ponzi fraud cases. Therefore, the Kakao-backed exchange wanted to take every action to prevent illegal fraud and establish a strong ecosystem for cryptocurrency market. A report in the indicated about Hankook Media reporting that the new system would be in place for a year. That would mean the system would close in March next year. The exchange is ready to take a call thereafter whether the period could be extended.

A cash reward is waiting for the first reporter who identified the illegal fraud. All that the users needed to do is to report any multi-level eyewitnesses or victims to Upbit and investigating officials to take it further. Users could choose the Upbit app, Kakao Talk to report the illegal scheme. The exchange indicated a cash reward of one million won, which is worth about $930, for reporting the incident.

Upbit enjoys the status of status being the biggest crypto exchange in the country and the third biggest at the international level. It’s 24-hour trading volume reached $1.1 billion. Bithumb, which is ranked second biggest in South Korea, managed a trading volume of $686 million in the same period. Significantly, the exchange has it’s monitoring ways to track down illegal multi-level coin recruitment or schemes with its own monitoring.

Recent Acts

On its part, Upbit is also monitoring whether any illegal coin recruitment or schemes are happening with its own system. As a result, the exchange was able to identify over 20 fraudulent cases to the police by March 23. In fact, the exchange was appreciated for its role in identifying the culprit, who was pretending to be a Metropolitan Police Agency of Seoul last November.

In any case, the exchange is not ready to leave any efforts to identify fraudulent acts. The exchange also cited Kakao Corp’s pre-sale of its coins. However, the company issued a notice stating that it was more concerned the amount of damage caused by the fraudulent activity of the distributor. Bithumb, which is a rival to Upbit, also joined to distribute brochures curbing the damage caused by fraud happening in cryptocurrency.