A small Bitcoin exchange based in Alberta, Canada, has gone offline. Before their Twitter page went offline, MapleChange had announced on Twitter that they “[had] no more funds to pay anyone back.” In the way of an explanation, the exchange had, approximately one hour before…
A small Bitcoin exchange based in Alberta, Canada, has gone offline. Before their Twitter page went offline, MapleChange had announced on Twitter that they “[had] no more funds to pay anyone back.”
In the way of an explanation, the exchange had, approximately one hour before deleting its Twitter page, said that a “bug” had enabled “some people” to withdraw all of the funds on the exchange. Educated readers may recall a time when Mt. Gox claimed similar problems. The handling of the two cases by their administrators was dramatically different. In the case of Mt. Gox, attempts were made to repair the damage, although they resulted in worse damage. They went so far as to near-nakedly manipulate the Bitcoin price in an attempt to recoup lost customer funds before anyone found out.
The MapleChange Twitter account possessed less than 2,000 followers.
By contrast, Coinbase has over 1 million followers on Twitter and lesser-known altcoin exchange C-Cex has nearly 100,000. In short, cryptonaughts are generally highly active on Twitter and the viewership on that platform is a semi-decent way to judge the popularity of a product or service in the space.
It’s been some time since we were able to report on a good old-fashioned exit scam. In the crypto space, we have primarily seen them in gambling, the dark web, and exchanges. The recipe is basic: gather trust of some clientele, get all their funds in one place, and run off with the money. It doesn’t actually matter the method by which you run off with the money, whether you claim a hack or simply up and disappear. The less-frequent (today) practice is precisely where the old wisdom of keeping one’s coins off exchanges and the like overnight comes from. You never know what’s going to happen next, and in cryptocurrency, you don’t have anything if you don’t have your own private keys. It’s just the nature of the thing.
Unfortunately, the MapleChange “hack” has all the signs of an exit scam.
For starters, there’s no need for the exchange to delete its social media pages or completely disappear in quite the fashion it has. There is no question that it is in debt to a number of depositors, gratefully a likely small number, but in business such things happen, and that’s what insurance or bankruptcy courts are for.
The short span of time between the announcement of the “bug” and the total disappearance of the exchange or its operators is another signal.
The domain itself, registered at GoDaddy by one “Flavius P,” is suspect. Most professional operations go to some lengths to be above board, especially those that handle other people’s money.
The timing of the problems is another significant factor in guessing that this is not a hack or a bug at all, but rather an elaborate, premeditated scam. As you can see by MapleChange.com’s recent traffic statistics, they were most probably doing more business over the last week than they had in recent times. If they are guilty of fraud, they struck early on a Sunday morning when they likely expected most clients to be sound asleep.
This story will be updated as new information becomes available. MapleChange representatives are welcome to reach out to CCN with more information.
Images from Shutterstock
Last modified: January 10, 2020 2:45 PM UTC