Bitcoin scams are back. CryptoDouble, a website founded on the promise of doubling its users’ deposits within 100 hours, ceased all its operations. At least 2233 BTC (about $500,000) have been cashed out on BTC-E, leaving thousands of customers out of pocket.
The service gained significant popularity on Bitcointalk, where customers first testified about the service and its supposed effectiveness.
Despite several warnings from advanced Bitcoin users and previous Bitcoin Ponzi scams, a significant number of users have been attracted by the website’s promises and its investment possibilities. More than 200 different altcoins were featured in the investment opportunity list. Customers simply had to pick up an altcoin and then blindly send their funds to CryptoDouble wallets’ addresses, hoping for ulterior interest.
Unfortunately for these users, today the website went offline without any notice. The total prejudice is still unknown at the time of writing – several different crypto-currencies and blockchains were used in this swindle.
However, as indicated by the address a crypto double customer used to send funds to, the scammer stole at least 2233 bitcoins and then sent the whole amount on BTC-e’s hot wallet to probably dump them.
While we don’t know yet the final scope of the disaster, the subsequent Bitcoin dumps are very likely to increase the current Bitcoin price plunge, in view of the significant sums involved.
The last two tweets sent from CryptoDouble, both on January 8, say:
There is highly coordinated and massive DDOS attack on CryptoDouble taking place right now. Our engineer handle it. Please allow some time. – Service is recovering now. We are still monitoring and analyzing the issue. All payouts will be processed shortly.
14/01/15 Update: A member of hashtalk is planning to launch a class-action lawsuit against CryptoDouble’s owner.
Images from CryptoDouble and Shutterstock.