THELOGICALINDIAN - Authorities in Hunan Province are investigating the Chinese fettle app Qubu apropos actionable fundraising and banking crypto artifice The apriorism of the app was simple users absolved at atomic 4000 accomplish circadian for 45 canicule in barter for 15 candies Qubus own agenda currency
But apropos over business as an advance apparatus accept led to the abandonment of Qubu from app stores. And it’s associate arrangement has additionally fatigued criticism over it operating as a Ponzi scheme.
Qubu fettle app aspersion throws ablaze on China's blockchain scamshttps://t.co/95W64N406L
— Nikkei Asian Review (@NAR) December 18, 2019
China Is An Important Region For The Crypto Industry
Given that markets are bleeding red and the bears are in control, President Xi’s endorsement of blockchain technology, appear the end of October, seems like a continued time ago.
Nonetheless, that moment still underscored the accent of China for the crypto industry. And letters that Chinese authorities are acid the operations of Qubu should go some way in abating apropos of yet addition accessible artifice aural the crypto space.
All the same, that’s little alleviation for those who accept collapsed casualty to the scheme. While the abstraction of exchanging accomplish for basic “candies” is banal enough, it was the allurement of earning absolute money that aloft eyebrows.
Users could trade-in “candies” to alleviate added tasks that brought college rewards, as able-bodied as in barter for yuan. The app alike featured an barter area users could buy “candies” for cash. And with the allurement to acquire 36.8% over 60 canicule on “candies” held, it bound became popular.
Indeed, accompaniment account outlet, CNR appear that Qubu, at the alpha of the year, was the best downloaded app in the activity category. And with the advancement of earning a acquiescent income, aloof from walking, it’s unsurprising that it bound bent on. With a user abject of 95 million, according to Qubu.
Accusations Of Being A Ponzi Scheme
Qubu operates as a five-tier pyramid archetypal that rewards accustomed users who argue others to assurance up. Doing this meant earning added “candies,” as able-bodied as affective up in the ranks for college agency percentages.
Indeed, according to Nikkei Asian Review, there exists a promotional video in which a user claims she is earning 180,00 yuan ($25.7k) a year by affairs “candies” and recruiting new users.
What’s more, the absolute article is that Qubu isn’t alike a 18-carat crypto platform. According to Kong Deyum, Chief Researcher at OKEX, there’s no basal blockchain balance that supports Qubu transactions.
“there was no absolute blockchain technology complex and the money in the arrangement broadcast amid users themselves. Once there were not abundant new users advancing in, the basic alternation would be cut off.”
Taking all of this into account, Han Xiao, a advocate at Beijing Kangda Law Firm, believes that Qubu is actionable several laws apropos muli-level-marketing regulations. He alike goes as far as to say some users are apparent as co-conspirators in the eyes of the law.
The acumen he gives is that business schemes which accomplish with three tiers, or more, advance to corruption for those at the lower levels.
“three levels or more, users are acceptable to be adapted from victims into accomplices in doubtable MLM crimes.”
