$18.5M HashFlare Funds Move After 3.5 Years, Raising Questions About Sentence Appeal

HashFlare, a cloud mining platform that sold contracts promising customers a share of cryptocurrency profits, has been at the center of a massive $577 million Ponzi scheme. Between 2015 and 2019, the company collected over $577 million from around 440,000 investors worldwide.

The problem was that HashFlare didn't have the computing power to keep up with its claims. Court filings revealed that the operation ran at about 1% of the Bitcoin mining capacity it claimed. Instead, the founders showed customers fake online dashboards with made-up performance data, falsely reporting mining activity and returns.

When investors asked to withdraw their money, the founders bought Bitcoin on exchanges to pay them, making the operation a classic Ponzi scheme. The pair used investor funds to buy real estate, luxury cars, expensive jewelry, and chartered private jet trips.

A cryptocurrency wallet connected to the HashFlare investment fraud has moved $18.5 million in Ethereum (ETH) after being inactive for roughly 3.5 years. The transfer was flagged by on-chain investigator ZachXBT, with security firm Cyvers helping to identify the activity.