The Philippine Securities and Exchange Commission (SEC) has issued an official warning to investors recommending caution when investing in digital assets.
SEC publicly announcedthat the cryptocurrency project Leefire/Leefire Limited/Leefire Ph/Leefire Philippines is a pyramid scheme. The project does not have a license to operate in the country and is not registered with the regulator. At the same time, Leefire offers investments through its website and mobile application available in the Google Play store, promising fabulous returns. The organizers of the project claim that upon registration, investors receive a cash bonus of 120 Philippine pesos ($2.3), which can be used to purchase various goods on the platform.
Pyramid participants can receive tokens by completing various tasks on the platform. The reward for users of the highest, level eight, is, according to advertising, $6,880. However, in order to withdraw funds, a Leefire member must necessarily invite other people to the project who will invest any amount. Only then are the tokens unlocked for withdrawal, the SEC says. For each new user registered using the referral link, the pyramid participant is promised $2.3.
The organizers of Leefire claim that until June 30, their LFC token will be traded on major cryptocurrency exchanges. The marketing materials of the project indicate that prior to listing on exchanges, the LFC token can be exchanged for the Philippine peso at a ratio of 1:1. Subsequently, users will be able to exchange the token for pesos only at a ratio of 1:10, and this caused even more suspicion from the regulator.
The SEC of the Philippines has called for no investment in the Leefire project and other pyramid-related investment schemes. The regulator warned that if any sites, brokers or dealers interact with Leefire, they face a fine of 5 million Philippine pesos ($96,000) or up to 21 years in prison.
In 2020, the Philippine regulator warned of a fraudulent cryptocurrency project called TBCoin, which was misleading investors into giving them passive income. However, in general, the Philippine government is quite loyal to cryptocurrencies. In April, the administration of the Philippine province of Bataan (FAB) announced plans to become an offshore financial center for the development of blockchain and cryptocurrencies.
Source: Bits
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