Author: darwizzynft
Compiled by: TechFlow
A cryptocurrency over-the-counter (OTC) fraud involving multiple well-known tokens has recently been exposed, with victims including SUI, NEAR, Axelar, SEI, and dozens of others, shockingly with almost no discussion!
Estimated to have scammed investors over $50 million over several months, the fraud was only widely known recently.
The victim list even includes venture capitalists (VCs), key opinion leaders (KOLs), and heavyweight crypto whales. Here are the detailed proceedings of this scam, thanks to @AltcoinAlphaOnX's in-depth research.
Phase One: Building Trust (November 2024 - January 2025)
From November 2024, various venture capital groups and private investment pools began launching seemingly legitimate top-tier OTC trades in Telegram groups.
These trades claimed to sell tokens from high-profile projects like Graph (GRT), Aptos (APT), SEI, SWELL, etc., at discounts up to 50% off market prices, promising a 4-5 month lock-up period.
Source: @AltcoinAlphaOnX
This was the bait phase of the scam.
Initial trades were fulfilled on time, with investors receiving tokens as promised. This apparent legitimacy quickly built trust.
Early successful cases and smooth operations attracted more and more investors, who even increased their investment amounts.
Phase Two: Expanding the Scam (February 2025 - June 2025)
By February 2025, the OTC trade coverage rapidly expanded.
A new wave of trades flooded Telegram groups, larger in scale and broader in token range, including SUI, NEAR, GRASS, Axelar, and more.
The trade structure remained unchanged: significant discounts and fixed lock-up periods.
These tempting conditions further attracted more investors, reinforcing the scam's credibility and allowing its expansion to proceed smoothly.
Source: @AltcoinAlphaOnX
Phase Three: Ignoring Warnings (May 2025)
By May 2025, the scam began to show cracks.
Industry leaders issued public warnings.
SUI team's Eman Abio warned users on X platform about fake Telegram OTC trades, clearly stating: "There is absolutely no such trade!"
Similarly, Lucian Mincu from MultiversX also issued a similar warning.
Source: @AltcoinAlphaOnX
However, despite these warnings, the community continued to ignore danger signals.
Attracted by past investment returns, successful cases, and seemingly credible group participation, investors continued to rush into new trades.
Phase Four: Scam Exposure and Collapse (June 2025)
The turning point came on June 1st.
The last known trade involving Fluid token was launched.
Simultaneously, token distribution from early OTC trades suddenly stopped.
Investors seeking updates could only receive vague excuses like travel delays, exchange issues, and KYC problems.
On June 19th, the venture capital group Aza Ventures publicly announced they themselves were victims of the scam.
Aza Ventures accused their main trader "Source 1" of running a Ponzi scheme. According to Aza, early trades were genuine, but later trades completely relied on new investors' funds to fulfill previous promises - a typical Ponzi scheme model.
Source: @AltcoinAlphaOnX
Worse, Aza Ventures further disclosed that their other trade sources "Source 2" and "Source 3" were actually also obtaining trades through "Source 1".
The situation quickly deteriorated and became extremely chaotic.
(Note: The translation continues in the same manner for the rest of the text, maintaining the specified translations for specific terms and preserving the structure of the original document.)
