1. How did Justin Sun cheat money?

In fact, it is very simple to put it bluntly, a Ponzi scheme. This is the most successful, classic and viable scam in the history of fraud. It has spawned countless branches and will continue to be popular in the future.

Sun Yuchen's Ponzi scheme was even simpler. He issued a "digital currency". In August 2017, Sun Yuchen released his "digital currency" - TRON, and easily reaped 600 million yuan from the leeks.

But here comes the problem, "digital currency" is not even as good as waste paper, but waste paper is still a piece of paper. So how did Justin Sun make 600 million yuan?

It's very simple to say.

It is common knowledge that money is issued by the state. The reason why money can serve as a general equivalent is that it is recognized by people, and this recognition is based on the support of the state.

Even a fool knows that the so-called "digital currency" issued privately has no value, but why can it still reap the benefits?

The method is very simple: make the leeks believe that these "digital currencies" are valuable and will appreciate.

As I just said, people’s trust in the currency issued by the state is rooted in their trust in the state. So when scammers issue “digital currency”, they must also make people believe in themselves.

The only way to make the leeks believe in themselves is to package themselves as successful people. So we can see that Justin Sun has a lot of titles, and he will never let go of any title that can add halo to himself.

Because all his capital lies in this, Justin Sun must seize every opportunity to market himself.

But packaging oneself is not all that matters for a successful scam. Sun Yuchen also needs help.

2. The secret of the Ponzi scheme’s longevity

Many people attribute the longevity of Ponzi schemes to exploiting human greed, which is true.

However, the most powerful thing about the Ponzi scheme is that it exploits human greed and makes people who join the scam become accomplices, either voluntarily or unconsciously.

The earliest "digital currency" is Bitcoin. However, the "digital currency" issued by Justin Sun and others is completely different from Bitcoin.

In simple terms, the total amount of Bitcoin is controlled, and the total amount is 21 million. Why is this so? Because the essence of Bitcoin is actually a special solution generated by a bunch of complex algorithms. A special solution refers to a set of solutions that can be obtained from a finite number of equations. And each special solution can solve the equation and is unique. If we use a banknote as an analogy, Bitcoin is the serial number of a banknote. If you know the serial number on a banknote, you own the banknote. The mining process is to continuously seek special solutions to this set of equations through huge amounts of calculations. This set of equations is designed to have only 21 million special solutions, so the upper limit of Bitcoin is 21 million.

As for other "digital currencies", such as Sun Yuchen's TRON, when it was first issued on August 1, 2017, there were 100 billion coins, of which 40% were publicly issued, and 600 million were harvested. Isn't this nonsense? If I claim that I have issued 100 billion coins, then it is 100 billion? This is just nonsense. In fact, it is normal, after all, it is just a number.

But it doesn’t matter, as long as there are investors willing to buy. As long as these investors think that Sun Yuchen’s TRON is valuable, whether it is really valuable or not is not a problem for the first batch of investors.

Because these leeks are not good leeks, they are all old leeks who have been through a lot. They are all veterans who have been struggling in the cryptocurrency circle and have experienced many harvests. These people will buy Sun Yuchen's TRON for the same purpose as Sun Yuchen, which is to make money.

The problem is that it is useless for these old investors to believe that Sun Yuchen's Tron is valuable. For example, 1,000 people bought Sun Yuchen's Tron. Except for Sun Yuchen who made 600 million yuan, the others exchanged real money for "digital currency". If these "digital currencies" are only circulated among these 1,000 people, they will never appreciate. If you want to make money, you must let Tron circulate. And to let it circulate, you must attract new people.

This is the most powerful part of the Ponzi scheme. The earliest investors actively became accomplices of the scammers. If they want to make money, they must get more people in.

So, making money turned into cheating money.

Therefore, the latecomers need new leeks to make up for their losses.

3. The most successful scammer

There are a lot of scammers who run Ponzi schemes. There are also a lot of people who issue "digital currencies" to defraud people. Sun Yuchen can't even be considered the one who has defrauded the most. But why can Sun Yuchen be ranked among the most successful scammers?

In January 2018, the price of Sun Yuchen's Tron reached its peak, reaching about $0.1951 per coin, 130 times the initial issuance. Sun Yuchen sold 6 billion Tron coins in a flash, harvesting 12 billion in an instant. This wave of operations stunned everyone in the scam circle. They are all veterans, and their skin has long been gone. If their conscience can be sold, they would have sold it long ago. But I have seen shameless people, but I have never seen such shameless people. If someone does not understand what this means, then think about whether it is allowed for major shareholders in the stock market to sell stocks so shamelessly.

The richest man in the “digital currency” circle said at the time: “Look at Justin Sun… You know he is a liar, but you are too embarrassed to call him names, for fear that others will call you idiots in return.”

This passage is really classic. There are two classic points: first, the richest man among the "digital currency" scammers does not admit that he is a scammer; second, even if he is outstanding among the scammers, he has to sincerely admire Sun Yuchen's shamelessness.

Liu Ming, the former COO of TRON, said: The money raised from issuing “digital currency” is equivalent to borrowing, and the purpose is to bring returns to participants through blockchain projects. However, Justin Sun believes that the money raised is his own, which is not a responsible attitude.

Hahaha, this is the same thinking as the previous one. He also thinks he is not a liar, and he also thinks he has never seen Justin Sun cheat so thoroughly.

Issuing currency requires corresponding assets. Do you guys who are developing "digital currency" have corresponding gold reserves, foreign exchange reserves, or national bonds and short-term commercial paper reserves?

They have nothing, but they come out to cheat people out of money. By the way, the cost of these people. A makeshift team of a few people, a bunch of copied and pasted codes, and a crudely made white paper, the total cost is generally 100,000 yuan. Then these scammers issued "currency" in a grand manner. Of course, they called it "digital currency". Using 100,000 yuan to exchange for hundreds of millions or even billions, this deal is very cost-effective.

But Sun Yuchen deserves the title of the most successful liar in China in the past decade, as he is admired by these scammers.

4. “Digital Currency” and Blockchain

Blockchain is a very hot topic recently, but although all "digital currencies" are under the banner of blockchain, they have nothing to do with blockchain.

There is no need to explain the reason. Currency issuance is a matter of the state. China's "digital currency" is just the digitization of the RMB, which has nothing to do with these scammers. The RMB is backed by the entire country. What do the scammers use to back it up?

Blockchain is very popular these days, and "digital currency" scammers are cheering because they have seen a great opportunity to commit fraud.

However, please take a closer look at this: Mu Changchun, deputy director of the Payment and Settlement Department of the Central Bank, said this about China's digital currency: "The central bank's digital currency DCEP is a digitized banknote."

“The functions and attributes of central bank digital currency are exactly the same as paper currency, except that it is in digital form.”

It’s just the digitalization of the RMB. Does it have anything in common with the “scammers’ coins”?

Their circle is called the "cryptocurrency circle", and people and things like losing everything and going bankrupt happen every day.

But none of these people deserve sympathy. There are two types of people in this circle. Those who want to get rich overnight and those who want to reap other people's money. There are only two types. What is there to sympathize with these two types of people?