Skycoin, a blockchain pioneer, falls prey to scammers
Skycoin, a Singapore-based firm called, was targeted by these evil scammers and is still dealing with the consequences today. After deciding to hire a PR firm to improve their website and run PR, the project and its co-founder found themselves caught in a web of extortion, dishonesty and crime that most people could never imagine could be real.
You may be captivated by stories of people making billions overnight, or you may be horrified by scams where the creators of fraudulent businesses flee to Tahiti with investors’ money. However, it is doubtful that the first thing that comes to mind are bloody stories of extortion and kidnapping.
The explosive profit potential of cryptocurrencies has attracted a multitude of extortionists, scammers, and outright criminals over the years since Bitcoin was first launched in January 2009. Some developers have had their companies’ reputations damaged by such scammers, and some have been beaten, kidnapped, and even with killed.
Skycoin’s mission and products
Skycoin is a prominent crypto company whose co-founder, Brandon Smietana, worked on the Bitcoin code and Satoshi Nakamoto. The project was originally conceived as an answer to questions that Bitcoin and Ethereum could not solve. Skycoin develops hardware and software that help businesses and individuals harness the potential of blockchain technology, regain control over their information, and optimize and secure networks and data storage.
The company’s flagship products are Fiber, an infinitely scalable and highly customizable parallel P2P network architecture. CX, a multi-functional programming language specialized for developing blockchain applications, Skyminer equipment for running Skywire network nodes, and zero-configuration hardware and blockchain solutions for enterprise networks.
Skycoin fell victim to scammers and opportunists
In February, Skycoin Global Foundation Singapore filed a federal RICO lawsuit (Skycoin v. Stephens, 22-cv-00708, US District Court) against some former contractors and several other defendants who have conducted a criminal campaign to exploit the company’s assets since 2018. This has involved paying journalists and social media groups to defame Skycoin’s reputation, as well as extortion, extortion and kidnapping.
The main defendants in the lawsuit are Bradford Stephens and Harrison Gevirtz, also known as ‘HaRRo’, who is considered the kingpin of the criminal underworld of blackhat marketing and founder of the infamous website blackhatworld.com.
After Skycoin hired the company in early 2018 to promote the project and implement SEO optimization, the site began to be flooded with spam, which included links to pornographic blogs. Stephens asked for $100,000 – $300,000 per month to end these attacks, but when he learned that it was the entrepreneurs behind them, Skycoin refused.
At the time, the conspirators demanded $30 million in BTC and $1 million in cash while threatening to delist SKY on leading exchanges if they were not paid.
But it didn’t just stop at extortion. In 2018, Smietana and his girlfriend were forcibly held in their Shanghai apartment by kidnappers who tried to force Skycoin’s co-founder to give up the passwords to his computer, which contained source code and other valuable information. After being beaten and tortured for six hours, Smietana surrendered, and the attackers managed to steal around $139,000 in Bitcoin and $220,000 in Skycoin. According to the lawsuit, Stephens and Gevirtz organized this kidnapping.
The crimes listed above suggest that blockchain companies and leaders need to take security seriously. Although successful projects have the potential to bring them and their investors untold wealth, they can also attract criminals who can cause irreparable harm to their companies and individuals. Experience has shown that some crypto entrepreneurs have even paid the ultimate price for their success.
In the lawsuit, Skycoin seeks to repair some of the damage caused by the fraudsters, restore its good name and get rid of the extortionists.
