The Story Of A Crypto Trader Who Was Banned After Showing Off Profits
The Story Of A Crypto Trader Who Was Banned After Showing Off Profits

The Story Of A Crypto Trader Who Was Banned After Showing Off Profits

382 views – At the age of 19, Stefan Qin claimed to have discovered the secret of successful crypto trading. The young man from Sydney confidently showed off profits of up to 500% to lure investors. After raising a lot of funds from investors, Qin leads a luxurious and carefree life in Manhattan.

Less than 5 years, his business collapsed after many investors filed protests. Qin also faces lawsuits that could potentially put him behind bars for years.

Like from hero to zero, how did this crypto trader’s story go to the bitter end? What lessons can crypto traders and investors take from Stefan Qin’s scam scandal?

Early Interest In The Crypto World

Born and raised in Australia, Stefan Qin was an excellent child in school, especially in mathematics. According to the expectations of his parents, Stefan dreamed of becoming a physicist after graduating from college.

However, his focus began to change when he interned at a company in China, where he was tasked with building two platforms based in China and the US to facilitate crypto arbitrations run by related companies.

From this experience, Qin was inspired to carry out the same strategy to profit in the crypto market. After being selected to participate in a Blockchain project at the University of New South Wales, Stefan Qin left and moved to New York in 2016.

Successful “migration” in the US

Armed with the knowledge of crypto arbitrage strategies he learned during his internship, Qin was eager to build a hedge fund company labeled Virgil Capital in New York. Although classified as a newcomer, Stefan Qin is good enough to promote his strategy to successfully convince many potential investors.

He said he could “exploit” the tendency of crypto coins to be traded at different prices on different exchange platforms. He also explained that the “market neutral” stance taken by his company would prevent investment funds from risking price movements.

Interestingly, the figure who claims to be a quantitative analyst does not charge management fees and only charges commissions based on the company’s trading performance. “We have never tried to make a profit by AJI mumpung,” he said when interviewed by DigFin Media.

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Within a year, Stefan Qin revealed that his company had earned a 500% return; a successful gimmick provoked many investors in a short time. Not only that, Virgin Capital is also claimed to bring 10% profit per month. In fact, the projected return on investment in this company is said to reach 2.811% in 3 years!

These promises were further reinforced by Stefan Qin’s reputation which was increasingly seen as convincing after his profile was reviewed by The Wall Street Journal in February 2018. No wonder that many investors then flocked to register with Virgin Capital and put their funds into hedge fund companies.

So much investor funds flowed, Qin was able to live a luxurious life in an apartment whose rent reached $23,000 a month. In his apartment, he enjoys all the high-end facilities such as swimming pool, sauna, steam room, hot tub, to golf simulator.

Been Defaulted When Billed Investors

“As smart as the carcass is covered, the smell still smells too”. The saying may be appropriate to describe a turning point in the story of this crypto trader. Entering the summer of 2020, about 4 years after Stefan Qin founded Virgin Capital, investors began to complain about the loss of assets and various transaction failures.

At the same time, 9 investors with a total fund of about $3.5 million demanded compensation from Virgin Capital’s flagship company, Virgil Sigma Fund LP. However, since Qin had siphoned off all of Sigma Fund’s assets and his company’s balance had been falsified, of course, no funds could be transferred to 9 investors.

Facing impatient investors, Qin first convinced them to move funds to the VQR multistrategy fund, another investment company he had just founded in February 2020. When he tried to withdraw $1.7 million from the company, Antonio Hallak, the head trader of the vqr fund, began to feel suspicious.

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At that time, Qin admitted that he needed funds quickly because he was being sued by loan sharks who lent him capital to start Virgin Capital. This trader also reasoned that he had difficulty managing his finances so he could not repay the debt on time.

Failing to convince Hallak with his “sad story”, Qin then tries to control vqr funds by force. Fortunately, at this point the SEC (Securities and Exchange Commission) has begun investigating the claims of suspected investors, so that the authority that oversees crypto trading in the US can immediately freeze VQR assets and take Qin’s case to court.

The Story Of A Crypto Trader Who Ended Badly

After wandering around and flying to South Korea to avoid investor accusations, Stefan Qin finally surrendered to the authorities and pleaded guilty to his fraud.

The maximum sentence that can be imposed on Stefan Qin is 20 years in prison. But in the process, prosecutors agreed to ease Qin’s sentence demands to 151 to 188 months alone, along with a fine of up to $350,000.

Then what about the investors who have been victims of fraud in this crypto trader story? A spokeswoman for Attorney Audrey Strauss confirmed that her team is working to recover investor losses.

This Compensation Fund is planned to be taken from the assets of the $24 million vqr fund that had previously been frozen. Even so, this amount is certainly not comparable to the total losses of investors reaching $90 million.

Crypto Investors Are Easily Caught By Fraud

From the twists and turns of the crypto trader’s story above, it can be concluded that Stefan Qin is really good at deceiving clients. However, the scam will not go smoothly for 4 years without the carelessness of credulous investors placing funds up to millions of dollars in the new company.

In fact, if these investors were more conscientious, they would be able to detect claims of fixed profits of 10 percent per month as one of the symptoms of fraud.

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The crypto market, which is currently experiencing rapid growth, is full of enthusiastic investors for profit. But because most of them are still newcomers and are not yet good at recognizing the tricks of fraudsters, many parties such as Stefan Qin use this ignorance to steal investors ‘ funds.

This doesn’t just happen once or twice. Various big names in the crypto industry have even been exposed to escape client funds. One of them is the case of BitConnect which cost investors billions of USD. Another example comes from QuadrigaCX, a Canadian crypto exchange that in 2019 closed after defrauding 76,000 investors and causing losses of up to $125 million.

Stricter crypto regulations won’t play much of a role if the majority of investors still lack knowledge and vigilance. About 800 crypto investment companies in different countries are currently run by parties who do not know the intricacies of the financial world. Some of them are even still in college or recent graduates who do not have much experience.

As such, Virgin Capital is not the only high-risk crypto investment firm. Stefan Qin could be just one of hundreds of stories of crypto traders desperate to manage client funds with an emergency strategy.

If you are interested in investing in the crypto market, be wise in choosing an exchange, investment company, or other institution that can keep your funds as investment capital. Do not trust easily with investment schemes that promise fixed profits. Learn how to identify crypto fraud modes and be realistic in responding to various offers that may stop in your search results.

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