"Science and Technology Innovation Board Daily" (Shanghai, reporter Chen Mo) reported that if the "dark horse" of 2018 coin circle is the launch of "trading mining" mode of FCoin, the "dark horse" in 2019 is some "destruction of three views", because it is naked "pull head".

Circle spread a word: "not on the MEXC project embarrassed to say they engage in pyramid selling."

With the help of MLM promotion, MEXC Exchange (MXC) rose rapidly by launching the so-called "mode currency" and "flow currency". The transaction fee in May this year rose more than 1,300 times compared with that in October last year.

So what's the story of MEXC, known as the "Big casino"? Who's driving the money frenzy?

Rub hot spot upper play "mode currency" popular

The MEXC Exchange had been lukewarm since its establishment in April 2018, until it found a way to capitalize on the hot spots in early 2019 with the rise of IEO (Initial Exchange Offering, a disguised ICO that is actually an exchange endorsement).

In February this year, MEXC launched "IOU", claiming that it was "future currency". Through the IEO project of Jeonhu Exchange, MEXC forced the introduction of coins before Ben, that is, the coins that others had not yet added on its platform, and bet on its skyrocketing price after its launch in advance. Since then, MEXC has become an instant hit.

What really makes MEXC popular is the "mode currency".

Mode coins, also known as "resonance coins", adopt the "resonance financing" mode, that is, users will save bitcoin, Ethereum and other mainstream coins in a designated wallet, in exchange for no underlying technical team, no real value of air coins.

Why do users pay real money for "air"? Because they believe in the power of pyramid schemes! Holding the belief that the earlier you join, the more you pull the head, the more resonance coins you get, and the lower the cost, a large number of desperate players join this silly game.

On February 23 this year, MEXC launched VDS, the "originator" of resonance currency. From the perspective of VDS/ETH trading pair, the highest intraday increase reached 5137% as of May 8, rising 51 times in two and a half months. Then began a one-sided decline, so far, from the peak is down about 95%.

It's worth noting that these are denominated in ETH, which rose 15% against the fiat currency itself between February 23 and May 8.

MEXC continues to replicate this successful model. VBT, which went online on May 12, for example, rose 264 percent in four days from May 15 to 18. However, the VBT has been restored to its original form in just three days and is now down about 90% from its peak and 73% from its opening price.

However, MEXC's rise has not been affected by the steep decline after the boom. Driven by star effects such as VDS, MEXC has quickly become an online celebrity exchange, harvesting huge traffic.

In May this year, MEXC's fee income reached 3,452,300 U.S. dollars, surpassing the first-tier exchanges such as Huobi and OKEx, surging 862 times from 4,000 dollars in September last year and more than 1,300 times from the lowest point in October last year. From February to June, MEXC's average NT MX range rose more than 134 times.

The single community attracts 500,000 fans in half a year

The emergence of the "MEXC Casino" has attracted a large number of followers, such as BiKi, invested by former Huobi co-founder and Golden Financial group founder Du Koon, and Huobi has also joined the fray.

On July 9, GOKO.com launched RS, the largest increase on the first day of trading was about 9 times, and then there was no more and now the price of the currency has gone to zero.

On August 28, BiKi was launched on NSC and rose more than 14 times on the first day. The next day, it hit a peak of nearly $2.50, up about 24 times from the opening price. On the third day, it plunged 60%, and so far, it has fallen 93% from the peak price.

Talking about NSC, the promotion team behind it said in an interview with Mars Finance in early November: RX and NSC are the first two projects incubated by the "K-ONE alliance", which rose 96 times and 25.6 times respectively. K-ONE Alliance is jointly established by early players in the currency circle, venture capital leaders, community leaders, God-level project operators and media in the circle, aiming to create a career platform for continuous wealth multiplication.

Since its inception in May this year, K-ONE Alliance has more than 1,400 internal communities, 1,600 external communities and more than 500,000 community fans. Through the community mechanism, the league strengthens the stickiness and popularity of fans and provides a steady stream of popularity and traffic for the projects it incubates.

At present, K-ONE Alliance has set up community incubation nodes in Shenzhen and Chengdu, and will set up more incubation nodes in Wuhan, Shanghai, Beijing, Changsha, Xi 'an, Hong Kong, Vietnam and Singapore.

The above statement also confirms that Shenzhen and Chengdu are the two most popular cities in the currency circle. Recently, there is news that Shenzhen has appeared in the currency circle investor rights events.

In fact, according to the "science and technology innovation board daily" reporter understanding, similar "K-ONE alliance" promotion team there are many, they even to invite the right to the original market promotion "master" to join the publicity stunt, do not shy away from mentioning "pyramid selling".

Bricks-and-mortar companies have been written off by bosses behind ICOs

How can a money dish like matcha, which is licking blood at the edge of a knife, die in public? Because the people behind it are deep enough.

A former MEXC employee said the company's internal policy penalized any employee who revealed his or her work address by deducting a month's salary, according to a report by Rui Rui Finance.

The interview of new employees is arranged outside the company, and the HR only gives the general address for the entry report. During the three-month trial period, the labor contract is not signed, there is no five social insurance and housing fund, and the salary is paid by the virtual currency USDT. "So there is no need to pay the operation tax, and MEXC saves a lot of money on the operation cost of the company".

According to the "science and technology innovation board Daily" reporter understands, a lot of exchanges are cunning rabbit three grottos, often registered outside the country, but the main team in the domestic, the office never receives strangers, and every other period of time to change the office location.

Despite this caution, there is a saying in investigative science that "crime leaves its mark." According to the reporter's verification from several industry insiders, the former domestic main body of the MEXC Exchange is Sichuan Miaoxing City Technology Co., LTD., there are rumors that the relevant person in charge has been summoned by the police.

Tianyan check shows that the company was established in July 2018, the registration authority is the Market Supervision Administration of Chengdu High-tech Zone, the legal representative is Chen Longjie, holding 80%, the other 20% is held by a natural person Liu Hongjiang, there is no other equity penetration relationship.

The company completed a simple write-off in June but is still Posting jobs in Beijing.

Also in June, MEXC announced that it had completed a second round of strategic financing from investors including Mizuki Fintech Fund.

By July, when MEXC again claimed Mr Tsai's personal strategic investment, the platform had more than 2m registered users, more than 200,000 daily lives and more than $600m in daily transactions.

CAI Wensheng, the founder of Meitu Xiuxiu from Fujian, has invested in a number of blockchain projects. According to industry insiders, Chen Jian, also from Fujian, is the player behind MEXC. Before establishing MEXC, he engaged in ICO activities and led users to participate in ICO project financing through the website.

The industry cries "94" again

On November 14, Shanghai's financial stability, mutual gold regulation of central bank of Shanghai headquarters run joint jointly issued "about virtual currency trading places MoPai renovation notice, asked the city district of virtual currency trading facility, ICO and promote drainage activities of MoPai, once found that Internet companies engaged in related immediately submitted, and supervise and urge the rectification.

After the outflow of documents, industry insiders shouted "94" again. In fact, "94" was always there.

Since the 18th collective study session of the Political Bureau of the CPC Central Committee on October 24, People's Daily, CCTV and others have repeatedly stressed that the application of blockchain is not speculation of currency, and we should be wary of virtual currency speculation under the guise of blockchain.

"Science and technology innovation board daily" reporters also learned from close to the regulator, the public security department and other planned to coin circle fund disk, pyramid selling activities for centralized regulation.

Released on November 8, dongguan city finance bureau risk warning, and reiterated on September 4, 2017, the central bank and other seven ministries jointly issued the "for the issue of financing risk prevention tokens announcement on August 24, 2018, the boj circ and so on five departments jointly issued the" on guard in the name of the "virtual currency" "block chain" illegal fund-raising risk warning ".

However, some industry observers point out that China's financial industry implements separate supervision, and new investment activities such as virtual currency do not have a unified authority. Moreover, most of the projects are registered overseas, and the promotion and transaction are all online, which brings certain difficulties to the supervision work.

Previously, Shenzhen local financial supervision Bureau staff also in an interview with the "Science and Technology Board Daily" reporters said, "this piece does not directly correspond to the regulatory departments, if cheated losses, can be reported to the public security organs."