Crypto Co-Founder Revealed To Be Infamous Fraudster, Investors Shaken (vice.com) 73
An anonymous reader quotes a report from Motherboard: Investors are shaken after the co-founder of a multi-billion dollar cryptocurrency protocol was accused of being a serial scammer with a record of conviction and deportation, and the co-founder of a fraudulent Canadian exchange that imploded. On Thursday, a Twitter user who goes by zachxbt.eth "with a track record of unmasking crypto scams and nefarious behavior," according to CoinDesk, accused "Sifu," a core member of the founding team behind the popular Avalanche-based Wonderland DeFi (or decentralized finance) protocol and its TIME token, of actually being Michael Patryn.
Patryn, who changed his legal name twice, was the co-founder of QuadrigaCX, a Canadian exchange that shut down after Patryn's partner Gerald Cotten suddenly died in India in 2018 while owing users around $190 million in crypto at the time's exchange rate. Patryn and Cotten reportedly parted ways in 2016. Later, investigators determined that Cotten was operating QuadrigaCX as a Ponzi scheme near the end of its life. Patryn has been convicted of several crimes, including computer fraud and bank and credit fraud, as Bloomberg reported in 2019. After the original tweets that revealed Sifu is Patryn, Daniele Sestagalli, the founder of Wonderland, confirmed the allegation. Sestagalli is a prolific developer who is behind multiple DeFi projects, including Abracadabra's Magic Internet Money (MIM) token.
"I want everyone to know that I was aware of this and decided that the past of an individual doesn't determine their future. I choose to value the time we spent together without knowing his past more than anything," Sestagalli wrote on Twitter. He later posted a statement explaining that he found out about Sifu's real identity a month ago, and has now decided to ask Patryn to step down. "I am of the opinion of giving second chances, as I have mentioned on Twitter. I've seen the community very divided about my choice of maintaining him as the treasury manager after finding out who he was and his past," Sestagali wrote. "Regardless, what has happened has happened. Now having taken some time to reflect, I have decided that he needs to step down till a vote for his confirmation is in place. Wonderland has the say to who manages its treasury not me or the rest of the wonderland team."
Patryn, who changed his legal name twice, was the co-founder of QuadrigaCX, a Canadian exchange that shut down after Patryn's partner Gerald Cotten suddenly died in India in 2018 while owing users around $190 million in crypto at the time's exchange rate. Patryn and Cotten reportedly parted ways in 2016. Later, investigators determined that Cotten was operating QuadrigaCX as a Ponzi scheme near the end of its life. Patryn has been convicted of several crimes, including computer fraud and bank and credit fraud, as Bloomberg reported in 2019. After the original tweets that revealed Sifu is Patryn, Daniele Sestagalli, the founder of Wonderland, confirmed the allegation. Sestagalli is a prolific developer who is behind multiple DeFi projects, including Abracadabra's Magic Internet Money (MIM) token.
"I want everyone to know that I was aware of this and decided that the past of an individual doesn't determine their future. I choose to value the time we spent together without knowing his past more than anything," Sestagalli wrote on Twitter. He later posted a statement explaining that he found out about Sifu's real identity a month ago, and has now decided to ask Patryn to step down. "I am of the opinion of giving second chances, as I have mentioned on Twitter. I've seen the community very divided about my choice of maintaining him as the treasury manager after finding out who he was and his past," Sestagali wrote. "Regardless, what has happened has happened. Now having taken some time to reflect, I have decided that he needs to step down till a vote for his confirmation is in place. Wonderland has the say to who manages its treasury not me or the rest of the wonderland team."
It's all fraud (Score:5, Insightful)
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Re:It's all (traceable) fraud (Score:3)
...And for those things, it works pretty well.
Fraud perhaps, because the people there are used to money laundering. Drugs buying - not so much. Pay cash and you can be pretty sure that one week later there's no trace. Pay with a blockchain and there's a record, even if partly anonymised, forever. With the main blockchains there's not even proper pseudonymity. Think of using your slashdot account to distribute child porn. Maybe for the odd stupid political comment you'll be fine. Once the FBI are on your trail you will get completely done over.
Think of
And it's not that bad to have those .. (Score:2)
People have too much money to burn, this is why the inflation is on the rise, as a very efficient counter we have Crypto-Hypsters to de-money them, which leads to less circulating money which in turn will put pressure on the prices.
But fresh people with too much money join the hype and keep the chain reaction working.
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Crypto, DeFi or whatever it's called on this particular day. Fraud and drugs is all it's good for.
Exactly, precisely this, which is what I've been saying for years now. 'Cryptocurrency' is a TROLL-MEME and so many of you have fallen for it so thoroughly that you all just double-down on it when you're told that because you'll go jump off a building in shame otherwise.
Get out of 'cryptocurrency' NOW, take your life and your dignity back.
Stable (Score:4, Informative)
I still go by the creed: Worth what people think it is worth.
Not much this time, lol, results may vary.
'nough said, have a great weekend
Mormons (Score:4, Interesting)
Oh wait... they didn't give a fuck!
Re:Mormons (Score:5, Interesting)
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Only if you let them do all the talking. I enjoy playing with them. They usually quit before we get through Genesis. Twos or sevens?
Nothing is funnier than two bible thumpers arguing about scripture. If they don't kill each other, both walk away from the debate about their imaginary friend convinced they owned the other.
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If you're going to slam a religion, at least get the facts right. Incorrect names, incorrect attribution, altering history, and just making stuff up exposes your fraud. If you're more subtle then the informed might start to believe your point of view. Instead you're a troll. :(
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Perhaps you could set the record straight, instead of just ranting!
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Local mormon missionaries are trying to convert me. I meet with them occasionally to try and figure out what the hell is going on, and maybe to deprogram them. Can you say more about Joseph Smith, do you have a link? I'd rather not google 'Joseph Smith con artist'
If you are "shaken" by such news... (Score:4, Insightful)
...then you haven't spent much time in the cryptoverse, sorry.
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Can you imagine the "earthquake" when the whole thing collapses?
Shook! (Score:2)
Re: Shook! (Score:2)
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That's such a millennial approach. They should make a bunch of metaverse timelines if they really want to show they're serious.
Well it's a tough one isn't it (Score:2)
Trust centralized swindlers and thieves with your hard earned, like with regular currencies, or trust fly-by.night decentralized cryptocurrency swindlers and thieves?
That's why I don't do cryptocurrencies: the state- and state-sponsored swindlers wield vastly more power, so their currencies are stronger.
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And backed by actual laws, with actual enforcement (most of the time). Don't forget that.
Re: Well it's a tough one isn't it (Score:2)
Agreed. Definitely better the devil you know when it comes to money and investments. You know banks and other financial institutions are out to screw you and dont pretend to be your friend so you know where you stand from the start whereas with crypto hucksters, who knows what their game is short term ( long term $$$ obv)
Shocked, shocked! (Score:5, Insightful)
We need a bot that automatially fp's "shocked, shocked" to every story about crypto.
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What about the "Oh noes! ...anyway" meme?
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Well... (Score:5, Interesting)
Considering that none of the original (public) crypto currency goals have been reached, it is easy to understand why the only 2 groups left in that area are "Idiots" who have no idea what they are doing, and "fraudsters" who seek to defraud the first group.
No Shit, Sherlock? (Score:2)
Shocked! I'm shocked, I tell you!
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A serial fraudster continues defrauding people?
Shocked! I'm shocked, I tell you!
And in the cryptocurrency area - who would have that was possible? I'm just as shocked as you are.
Re: No Shit, Sherlock? (Score:2)
It's a perfect match really. Crypto enthusiasts like being defrauded. The will defend scams that they aren't even involved in as a mattee of principle.
The real dream is to be part of a friend's wash trade or pump and dump scheme. Bonus points if your friend sets you up to pump but you're actually the dump.
Well since... (Score:3)
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To be fair, ten years of living a Billionare's life is better than a full 90 years of any of our lives.
The only thing shaking. (Score:2)
obCasablanca (Score:2)
"I am shocked, shocked that there could be fraudsters in the imaginary currency world. "
"Your cryptocurrency winnings sir."
"Thank you."
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"I am shocked, shocked that there could be fraudsters in the imaginary currency world. "
What's even more shocking, is that your currency is also imaginary, and has been for decades now.
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Some would say currency has been imaginary for all of human history.
Money could be considered a token of perceived value. That token can take many forms - bits in a computer, printed pieces of paper, small disks of gold, sea shells, extremely large carved pieces of stone, cattle, etc. Or derivatives thereof - such as the very common practice of taking a stick and using it to symbolize debt, which is then us
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I have my doubts. Currencies are useful when they act as a stable store of value over time. This allows us to agree to, and plan for, transactions in the future - taking out a car loan, or signing a lease, or agreeing to a salary at a new job.
Bitcoin fails horribly at this.
It may be that most crypto will fail horribly at this. The creation and destruction of traditional fiat currency does allow a degree of control fo
Correction: (Score:1)
Avalanche-based Wonderland DeFi (or decentralized finance)
Nice try - "DeFi" really stands for "Deregulated Finance".
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QuadrigaCX not regulated by anybody for a reason (Score:3)
Is the value real? Is the currency fungible? (Score:3)
I have a question, which I figure I'll ask on Slashdot.
In your opinion, are crypto-billionaires actual billionaires, or billionaires on paper?
Meaning, can anyone actually pull a hard, old-fashioned, and, most importantly, usable at scale currency out of the stated value of their cryptocurrency? You can't buy a megayacht with Bitcoin, can you? A helicopter? A 500 million dollar house? Could you actually trade it in for a billion [your country's currency]?
Because otherwise all this is is a circle jerk and small potatoes transactions until a significant chunk of the world economy runs on some particular crypto standard.
Are large-scale transactions like that possible, or are people just hoarding something with value on paper based in nothing but the belief that it's valuable?
I'm sorry if that sounds like a leading question, because it is. Please disabuse me of my mistaken ideas. Yes, I do know what blockchain is.
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Yes, you can. Unless you are speaking about some centralized, small time, speculation only shitcoin, selling that much won't affect the price of say Bitcoin or Ethereum. And these days, finding
Re: Is the value real? Is the currency fungible? (Score:2)
Do any of these exchanges have 500 million in USD assets they can turn over to me today if I want to cash out? How long does it take to cash out large sums?
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This applies to all assets other than cash -- things like stocks, real estate, food trucks, tulips, etc. The assets have an estimated value. When you want to convert it to cash, you'll find out what it's really worth in the market.
People also criticize regular currency in a similar way, asking what you can really buy with it. You have the paper, but what is it actually worth? Can you travel and buy things with it?
It's the same belief in anything el
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tl;dr: No. Not by a long shot.
The entire crypto market is horribly over-leveraged, in the true sense of the term: its face market cap value is waaaay higher than the actual monetary value you can ever extract from it.
Is anyone surprised? (Score:2)
The future (Score:1)
Because ya know — It’s the future — we’ve all decided centralized banking is rigged so we trust more in fly-by-night Ponzi schemes.
What made me laugh (Score:2)
"I want everyone to know that I was aware of this and decided that the past of an individual doesn't determine their future. I choose to value the time we spent together without knowing his past more than anything,"
One of the sad lessons of my long life is that although "that the past of an individual doesn't determine their future", an individual's past is by far the best predictor of the future.
Bold innovation! (Score:2)
Gerald Cotten dead? (Score:2)
His wife said he was dead. Boo hoo hoo! So very sad. But he died in India and she's not really sure what happened except it was some kind of sudden "infection" and she doesn't have his body but she has it on good authority that he died. And she doesn't know the keys to enable anybody to get their money back and the knowledge of the keys died with him, so the c
The biggest fraud (Score:1)
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and it's been the world's global currency for 78 years. they're doing a good job.
I am... (Score:3)
Why are you even surprised by this? (Score:2)
Anyone involved in crypto should know that everyone involved in crypto is a lying grifter, and if they're not that means they're not qualified for the job.
Gerald Cotten (Score:2)
Must be a joke here (Score:2)
Seriously disappointed by the lack of Funny on this story.
So what ? (Score:1)
One more step towards Idiocracy (Score:1)
Crypto Co-Founder Revealed To Be Infamous Fraudster, Investors Shaken
Headline should read: All Crypto Known To Be Fraud, Investors Give Zero Fucks
This little gem (Score:2)
"Patryn, who changed his legal name twice"
Yeah, that should've raised a few red flags.
I'm shocked (Score:1)
I'm shocked, who would have thought the whole premise of crypto currency is based on fraud and scams, unbelievable. I just hope nobody looks to closely at religion we don't want to find out thats a scam to, democracy, freedom of speech...