There are many ways people can earn from cryptocurrencies. Instead of investing directly in cryptocurrencies, one way to do it is by mining. How exactly does mining work? Mining plays a role in confirming transactions in the public ledger. It makes use of computers in order to solve mathematical algorithms. And for this reason, many are looking to invest in this type of venture.
Mining, however, is an expensive venture especially today. It requires a good amount of computational power, not to mention a massive amount of energy.
And for this reason, there are mining operations that require funding from different investors who believe in the power of blockchain. Unfortunately, not all mining operations can provide you with success. There is always the possibility that the price of the cryptocurrency drops and mining operations suddenly doesn’t become profitable.
This time around in Vietnam, a CEO of a mining firm Sky Mining has been reported to have run off with the company and investor’s fund worth around $35 million. According to reports, CEO Le Minh Tam left a week ago. The disappearance was coupled with a wipeout in the company’s funds. However, he expressed an apology in a Facebook post after not being found in person. He explained that the profitability of the company has dwindled due to market volatility.
According to Tam, investors should go to the company’s office in order to get their capital. After which, he will then be declaring bankruptcy. However, investors discovered that Sky Mining’s headquarters in Ho Chi Minh City is closed and all of the signage has been removed.
Huge Mining Operation
Ski Mining is a huge mining operation. The company had around 600 miners. All of these mining facilities have also been taken away by people who claimed to be “maintenance workers”.
The good news is that Le Minh Hieu who is the deputy chairman of Sky Mining decided to start a board that is dedicated to helping those investors who lost their money. In addition to extending help, the board is also going to be in charge of knowing the extent of the losses as well as the remaining value.
Though the exact amount is not yet known especially when it comes to the company’s assets since Tam is directly in charge of the mining rigs, it was estimated that the loss is around $35 million.
Filed a Complaint vs. the Mining Company
There are twenty investors who already filed a complaint with the local police. However, the board mentioned that they are not guilty but rather victims too by the CEO.
This incident happened after the collapse of a Ponzi scheme that made use of a fake Initial Coin Offering. It was reported then that around $660 million was stolen from around 32,000 people.
And because of the growing number of scams, Vietnam has become strict when it comes to their crypto-related activities. Vietnam already banned local companies from engaging in activities that are related to cryptos. In addition to this, the Central bank also supported the call to ban the import of cryptocurrency mining equipment.