BlockAura Crypto Coin Cracks After Some Indians Get 3,100 Percent Returns
Sanjay Kamble hit the jackpot when the obscure token he invested in grew nearly 3,100 percent in eight months. He left his defunct marketing business this year and became a full-time crypto evangelist. These days, the 51-year-old drives his new Toyota sedan – which he couldn’t afford last year – on the dirt roads of his hometown in rural India, showing off his success investing in BlockAura tokens. He urges farmers, teachers, housewives, friends, relatives and neighbors to join him, promising that the money they invested will triple in 300 days.
“I don’t need a day job,” Kamble said over the phone from Sangli, about 230 km southeast of Mumbai. “BlockAura is the next Bitcoin.”
Kamble is among thousands of investors in India betting crypto is the fastest way to get rich, lured by dozens of startups promising yields of up to 25 percent a month on so-called big rewards in a laxly regulated market. These are fees for investing in illegal tokens and referral bonuses for what are often high-quality affiliate networks. Word of mouth is too good to ignore in a country where annual per capita income is among the lowest in the world. Critics like Pranjal Daniel at Strategy India warn some of these networks often turn into pyramid schemes.
The digital asset that Kamble is promoting is already showing signs of trouble, indicating a broader downturn in the crypto space this year. The recent collapse of Sam Bankman-Fried’s booming FTX empire and the turmoil it sparked have spread to other companies as well. Crypto lender BlockFi filed for bankruptcy this week, and brokerage Genesis wants to avoid the same fate. But industry advocates such as Changpeng “CZ” Zhao, founder of the world’s largest crypto exchange Binance Holdings, said this is not the end.
BlockAura’s native token, called TBAC, has fallen 90 percent to $3.03 (about Rs. 250) from an all-time high of $32.30 (about Rs. 2,600) in July, according to by CoinGecko, an aggregator of token values. On PancakeSwap, it trades for $3 (approx. Rs. 240) on its own with a seven-day volume of just $20,000 (approx. Rs. 16,22,000), while on UniSwap, it can be exchanged for another token for around $19 (approx. -Rs. 1,500) a piece, although there is not much trade there.
Following the plunge, BlockAura hit a daily drawdown of $250 (roughly Rs. 20,000) to prevent panic selling. It has set such difficult conditions that many investors cannot even cut their losses and exit completely. That means Kamble’s daily earnings of $2,000 (roughly Rs. 1,62,000) — through deposits, referrals and tokens earned through reinvestment — are worth a lot less now, at least on paper.
Kamble is undaunted and is betting that TBAC will rise to $10,000 (roughly Rs. 8,11,000) in two to three years.
The rush for quick money makes many investors ignore the warnings of high risks from some big names in finance: JPMorgan Chase CEO Jamie Dimon in September described cryptocurrencies as “suspended ponzi schemes,” while the Monetary Authority of Singapore in August. he called such investments “very risky.” India began taxing crypto transactions this year in an effort to track deals and curb the wider trade. Finance Minister Nirmala Sitharaman said that the biggest danger to countries is the potential misuse of cryptocurrencies for money laundering and terrorist financing.
A multi-level marketing model based on referral fees – where tokens are placed primarily on those networks – is very risky. Investors earn less liquid, native tokens that may experience price volatility during withdrawals. BlockAura Foundation founder Firoz Multani said his platform accepts network marketing, but not the pyramid, model, and referral incentives that are mainly used to expand the user base, he said. Profits can fluctuate depending on the price of the token, but there is no risk of losing money, as the stake profits distributed to the public help to recover the principal within five months, he said.
Apart from BlockAura, SBG Global and ApeJet are among the other Indian startups that have emerged in the last year or so.
Launched in 2021, BlockAura now has 60,000 investors, according to Multani, an Indian based in Dubai. SBG Global, founded by real estate developer Anil Yadav, triples profits in 20 months and boasts over 100,000 users. ApeJet, a new entrant, is flying free iPhones to apartments worth $605,000 (about Rs. 5 crore) in Dubai as a trial.
None of these startups have been accused of any wrongdoing, but experts including Ari Redbord, head of legal and government affairs at San Francisco-based blockchain intelligence firm TRM Labs, warn that such get-rich-quick chains increase the risk of fraud.
“There’s an unnatural excitement in the atmosphere and a lot of people have been gripped by the fear of missing out,” said Redbord. “That’s a way of fraud and fraud” more widely in this space, he said.
About 60 percent of SBG Global’s users are part of its premium sales model, and the platform has a plan to deal with potential risks by offering different products, said its global marketing head Praveen Rai. ApeJet founder Mayank Dudeja did not respond to messages and calls seeking comment.
India has seen its share of crypto fraud in recent years. In 2018, a police investigation found that more than 25,000 investors were defrauded, while the nation’s highest court heard a case of alleged fraud worth $1.6 billion (roughly Rs. 13,000 crore) in current prices. BitConnect, a global scam worth around $2.4 billion (roughly Rs. 19,500 crore), originated in India.
No Geography
“The amazing thing is that these companies are able to operate without being regulated,” said Mark Mobius, founder of Mobius Capital Partners. “Regulators have a big problem,” he said, adding that crypto has no geography, “you can’t put your hands on it, it’s in the air.”
The Reserve Bank of India has not seen a problem yet, according to the Deputy Governor T. Rabbi Sankar. Although researcher Chainalysis ranks India number four in the world in crypto acquisitions, Sankar said that a very large proportion of investors have small stakes. However, it often warns the public about dangers.
“What we need is a coordinated global approach,” Sankar said in an interview in Singapore, echoing the Indian government’s stance. “Nobody wants a situation where people lose their money.”
The risks are even more pronounced, given the nature of high-profile advertising networks, said Daniel, chief strategist at Strategy India, a Mumbai-based firm that studies fraud schemes.
“What’s different about MLM and other ponzi schemes in crypto is the tokenization process, and the ability to convert new coins at will, market them as conversions, raise prices, and then run away with the profits,” said Eric Jardine, Cybercrimes. Research Leader in Chainalysis.
Apart from the daily limits, BlockAura told its investors that it is operating on the basis of a price of $61 (roughly Rs. 5,000) per token – which is much higher than the prevailing market price – which means that users will pocket less money when they redeem their rewards. . . TBAC is currently in experimental mode. It was scheduled to go live last month, but that has been postponed. BlockAura is also launching multiple versions of the token at higher prices.
speaking
Some unhappy users are speaking out. Akhilesh Agarwal, 52, had invested $10,000 (approx. Rs. 8,11,300) in BlockAura tokens in May and collected $25,000 (approx. Rs. 20,28,000) in rewards over the next four months. Preventive measures mean his principalship is over, he said, adding that he quit in November.
“I was deceived, I don’t want to deceive many users,” he said from New Delhi. “Few people made money in the beginning when the price of the token went up. Now we can’t withdraw and everyone’s money is stuck.
Multani rejected such appeals, adding that the withdrawal limits were temporary. “Those who believe in BlockAura and know that the coin will touch $100 (about Rs. 8,000) within a year will stay,” he said. “TBAC is a valuable store. My goal is that no one should lose money.
Other users have shared what they say are thousands of success stories like Kamble’s. “You need to have the stomach to take risks if you want high returns,” said Saurav Kumar, 33, who has put his full faith in SBG Global, after losing money in another blockchain network.
Yashveer Chauhan, 21, a college student and ApeJet investor, won a new Kia Sonet compact SUV as a reward for bringing more investors to the chain, a few months after owning an iPhone. “There is no loss in this program as the public will support the token,” he said.
Three blockchain firms flew hundreds of their top performers from India to Dubai in October as part of their awards program, showcasing them at an industry event in an effort to attract more overseas. For SBG Global and BlockAura investors, this was their second international trip in about three months after visiting Singapore in June and July, where they filled half a conference room in a luxury hotel and congratulated the founders.
“The rewards are helping to build a community,” said Yadav, founder of SBG Global, which invests clients’ money in real estate, foreign exchange and crypto trading to earn those returns. “The one with the community will win.”
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