Spanish police have arrested the operator of the cryptocurrency arbitration firm Arbistar 2.0, which, according to law enforcement agencies, was a $ 1 billion cryptocurrency pyramid.
According to La Provincial, the organizer of the cryptocurrency scheme, Santiago Fuentes, was detained in Tenerife and formally charged with financial fraud and money laundering.
According to Tulip Research, Fuentes’ site served about 120,000 users who invested 40,000 BTC in an arbitrage trading bot. In total, BTC equivalent to $ 1 billion was invested in the Arbistar 2.0 cryptocurrency scheme.
Investors began accusing the platform of fraud last month when Fuentes said a “computer error” had prevented trading bots from stripping assets and wiped out more than a quarter of the money. Tulip said it links some of Arbistar 2.0’s asset stripping activities to the Hydra darknet market.
The company called the frequent payments of interest for the use of cryptoassets (up to 1% per day) and the limited options for withdrawing money (only on weekends) elements of the “classic pyramid”. Fuentes has previously denied allegations of fraud or bankruptcy for Arbistar 2.0.
Recently, the Indian Malapurram District Police launched an investigation into the owner of three cryptocurrency firms, who called for investing in Morris Coin cryptocurrency. In addition, in September, the head of the Argyle Coin cryptocurrency pyramid, which offered investments in diamonds, was charged with fraud.