Venezuela is one of the most progressive countries in the world in terms of Bitcoin adoption. This trend in recent years has been seriously promoted by the huge inflation of the national currency in the country, which forced local citizens to look for more reliable ways to preserve their savings in alternative assets.
However, the growing popularity of cryptocurrencies is also attracting scammers. A striking example of this is the story of 23-year-old financial analyst Andres Jesus Dos Santos Hernandez. He faked his kidnapping in order to steal over a million dollars in crypto funds from his clients. Let’s talk about the situation in more detail.
Recall that cryptocurrency is often used by scammers due to the nature of digital assets. The latter are primarily decentralized, that is, they do not depend on any one body. Accordingly, after the theft of the coins, the wallets of the criminals will most likely not be frozen – unless they bring the cryptocurrency to the exchange or hold USDT (in this case, the cryptocurrency issuer Tether can block the address).
There are enough cases of demand for ransom in the crypt. For example, in January 2019, the wife of Norwegian millionaire Tom Hagen was kidnapped in Norway, and they demanded the equivalent of $ 10 million in Monero cryptocurrency for her release.
Last summer, the University of California, whose staff was researching COVID-19, fell victim to hackers. Their data was blocked, and the fraudsters had to pay 116 bitcoins to unblock it.
How cryptocurrency is stolen
Information about the theft of money quickly reached the national police agency CICPC – the local counterpart of the US Federal Bureau of Investigation (FBI). The head of the organ, Douglas Rico, posted on his Instagram a photo of Hernandez announcing the search for the criminal. It looks like this.
Hernandez Photos
According to Rico’s statement, Hernandez worked as a kind of investment intermediary for several clients, that is, in fact, he helped them with investments. The head of the CICPC claims that the suspect emptied his clients’ wallets in the accounts of the Binance crypto exchange in the amount of $ 1.15 million. After that, he stated that he had been abducted, and that the kidnappers allegedly forced him to take the money.
Now Hernandez is hiding from the authorities, while law enforcement agencies still do not know whether it is necessary to declare the fraudster on the international wanted list. Some believe that he has already managed to leave the territory of Venezuela and hide in another state. Worst of all, stories like this are not uncommon in the country, Decrypt reports. For example, recently local businessman Gustavo Torres Gonzalez was kidnapped by unknown criminals and later executed because they did not receive the required ransom of 1.5 BTC for his release.
Even more negative news comes from another Latin American country – El Salvador. According to Cointelegraph, in the capital of the state of San Salvador, a march of protesters against the adoption of Bitcoin as a legal tender took place the day before. The participants in the protest were pensioners, disabled people and workers. In their opinion, the Bitcoin price is not stable enough to integrate cryptocurrency into the national economy.
We believe that what is happening is reminiscent of a joke or at least a political move by the opponents of the country’s President Nayib Bukele, who is an active fan of cryptocurrencies. Yet, usually, many people cannot understand the structure of the blockchain and how digital assets work, let alone older retirees. In addition, protests against the volatility of the Bitcoin exchange rate seem strange against the background of the same inflation in the country, that is, a more tangible problem.
Protest against Bitcoin adoption in El Salvador
Recall that a few months ago, President of Salvador Nayib Bukele announced a new bill, according to which BTC will become a full-fledged analogue of the national currency in the country. And although this news was greeted positively by members of the cryptocurrency community, many financial experts expressed concern that such a strategy would only harm the state’s economy in the long term.
The law on the adoption of Bitcoin comes into force on September 7, while the president notes that BTC will not be forced on all citizens: if they do not like cryptocurrency, they can continue to use regular money and payment platforms . This is a logical conclusion, because so far El Salvador does not have the necessary infrastructure for full-fledged adoption of Bitcoin, in addition, a very large proportion of the local population simply does not understand how to use it.
We believe that in this case, it is not cryptocurrencies that are to blame, but people who choose to use the features of digital currencies in an illegal way. Still, you can get access to coins anywhere in the world, so attackers can go to another country, taking with them the stolen cryptocurrencies. I would like to believe that the money of the defrauded investors will still be returned. And this is another reminder that you need to control your funds exclusively personally.
