• The DFI received several complaints regarding Coscoin, a well-known crypto app for integrating AI and Web3.

• In September 2023, Coscoin surpassed 500,000 in South Korea and Japan and announced its plans to broaden its international reach. 

• In England, over 78 reports have been filed, resulting in a total loss of £214,869($235,008.67) and an average loss of £2,900($3171.82) per person.

The Web3 Industry has significantly improved from the basic functionalities of Bitcoin. It has expanded into many domains, consistently evolving into new forms. For instance, developers utilize the basic functionalities of Bitcoin to develop altcoins like Ethereum, Cardano, Solana, and over 10,000 others. 

This eventually evolved into creating stablecoins, flatcoins, memecoins, and CBDCs, forming entirely new financial systems, DeFi, and fintech. The industry went a step further, going beyond the economic systems to develop decentralized applications.

This led to many organizations adopting blockchain technology, improving their transparency, efficiency, and accountability. 

The web has grown, showcasing a trillion-dollar potential across numerous niches. Unfortunately, this has also led to the development of scammers and hackers within the franchise. For instance, since the FTX crash, it has become clear that even top web3 titans can become a well-thought-out fraud scheme waiting to be unveiled.

In recent news, Coscoin, an upcoming crypto investment application renowned for its ability to merge AI and blockchain, was flagged by authorities as a Crypto scam. This news proves that web3 is still required to double its efforts to spread awareness, preventing users from dealing with such cases.

CosCoin is another crypto scam running the franchise’s reputation.

Despite the FTX crash nearly ruining the crypto market, it was a learning curve for the entire world. It taught us that even well-established crypto exchanges can mask their true nature. Since then, the industry has been on high alert as regulatory bodies flag any suspicious activity from crypto-based organizations. 

Unfortunately, this didn’t deter some developers from venturing into the vice. In recent news, the Securities Division from the Washington State Department of Financial Institutions (DFI) received several complaints regarding Coiscoin, a crypto app well known for integrating Artificial Intelligence and Web3.

The complaint alleged that it is not only an unregulated and unlicensed cryptocurrency trading company but has recently scammed several users out of their hard-earned money.

The alleged Ponzi scheme has affected several UK-based clients, who expressed deep concern over the recent system failure. According to reports to the police, users have not withdrawn their investments since November.

Many users initially stated that the application saw the incident as a technical issue. Still, after months of no progress, the true nature of the crypto scam is steadily unveiling itself.

The North East Regional Organised Crime Unit (NEROCU) has issued several warnings following many reports. According to authorities, the exchange showcased an eerily similar Ponzi or Pyramid Scheme. The application incentivizes users to recruit people for the platform.

Also, Read Nansen Users Targeted in Phishing Scam Connected to Prior Data Breach.

Det Insp Paddy O’Keefe, who leads the economic crime team, said, “When it comes to money, it might sound repetitive, but if it sounds too good to be true, it probably is. Criminals will also create scams promising to recover investments, so please avoid any instances where you could be a victim of further fraud linked to your original loss.“

The Securities Division has yet to confirm the actual location of the business. In addition, the phone number registered under Coscoin does not appear valid.

The DFI has urged consumers to exercise extreme caution when dealing with any solicitation offering investment or financial services or using an unregistered or unverified cryptocurrency trading platform.

The “Honey” Coscoin Lured in Investors

According to its whitepaper, Jackson Blaze founded Coscoin in 2015 as a digital currency built on a blockchain network utilizing AI in most of its functioning. It initially leveraged AI technology to provide quantitative trading, allowing users to make more precise investment decisions by forecasting market trends. 

AI has been a trend in technology for the past decade. Combining AI and Blockchain presented an unexplored niche within the crypto market. In addition, the crypto investment application provides social trading services, creating a pool of information from veteran investors in the market. 

The combination has lured various investors as their potential presented a lucrative future for the applications. By pegging on the field’s potential, Coscoin eventually got a substantial user base and a market share.

In September 2023, the app surpassed 500,000 in South Korea and Japan and announced its plans to broaden its international reach. In the same month, it crossed the 800,000 mark in South America, a testament to its vast potential.

Thus, when its services halted, shockwaves passed through its vast network. Unfortunately, the organization has not released an official comment on the allegations.

The crypto application has been branded a scam, and authorities have raised alerts about such cases. Since the FTX crash, authorities have urged users to forward such cases to battle threats directly to the industry.

Also, Read South Africa suffers another crypto scam: The Obelisk Whatsapp scam.