Mybtgwallet Scam: Victims to Sue the Bitcoin Gold Team

The group of Mybtgwallet scam victims has been negotiating refund of $5 million stolen in users funds with the Bitcoin Gold team for the past month. As the talks are stalled, there is no way for victims but to sue the core team members.

Representative of the group and President of the newly created NGO “Crypto-ombudsman” Vadim Levin told ForkLog Magazine about reasons for failed negotiations and further measures the group is going to take.

From the very beginning the Bitcoin Gold core team members have opposed any media contacts of victims. They’ve threaten to give up the cooperation and stop providing victims with information about searching for John Dass, the developer behind Mybtgwallet.

Some hawks of the group sought to inform all cryptocurrency exchanges about the questionable ties between the BTG core team and Mr. Dass’ project. Such efforts have resulted in the failed peaceful settlement.

Failure of the peaceful resolution

The Bitcoin Gold team has agreed to refund an unspecified amount of money after ForkLog Magazine and CoinDesk published first articles about the scam. Developers demanded from victims to found the official organization that will possess a digital wallet to receive BTG coins.

It’s worth mentioning that the core team didn’t mention whether it will be a compensation or donation. However, both sides agreed to cooperate in accordance to this plan.

The group led by Vadim Levin has filed for new NGO “Crypto-ombudsman” with the Ministry of Justice of Ukraine. It’s currently up for approval, but the statute has been already notarized. The group has also elected five members to its supervisory board that will speak on behalf of victims. “Crypto-ombudsman” hereby fulfilled all the demands.

The leadership of the NGO has also cooperated with research lab Neutrino that released an independent report on criminal’s wallets to which users funds had been transferred. This report has allowed the supervisory board to identify all victims willing to join the organization and confirm their losses.

Core team developer Martin Kuvandzhiev has criticized the organization’s website for a “significant marketing component” and questioned the notarized statute. “Crypto-ombudsman” representatives say that after that incident they realized that the Bitcoin Gold team was playing for time.

Moreover, when the supervisory board attempted to press the core team on the compensation issue, developers just said that the entire idea belonged to Joseph, a support staff worker who had proposed to initiate a campaign to raise funds for the victims. They didn’t intend to refund anything. They’ve just proposed to donate a monthly salary. “Crypto-ombudsman” didn’t expect such a development.

It’s worth mentioning that BTG developers were reluctant to share information about John Dass and how he was engaged into creating the digital wallet. They claim that a group of independent experts has checked his biography, but don’t specify any names.

Worsening tensions

Hawks among the victims have resumed the campaign to inform cryptocurrency exchanges about the issue. The BTG core team was angered at this move and said the victims didn’t deserve any help at all and that they would only deal with developers’ lawyers.

Martin Kuvandzhiev warned them that if exchanges refuse to list BTG, there will be no Bitcoin Gold project and subsequently there will be no coins to compensate. Notably, he used word “compensate” rather than “donate”.

Furthermore, some unknown individuals joined the official victims’ Slack-channel to force the group to cease pressure on BTG project. They also threatened the victims.

Alleged BTG trader named Punisher accused the group of dropping down the price and harming miners and traders by contacting media.

User going under name Marat is a member of the supervisory board and leads the hawks, who seek to make the situation as public as possible through media. An unknown individual created a fake Twitter-page of Marat to discredit the entire initiative of “Crypto-ombudsman”, which is to help the victims return stolen funds, but not to destroy the project.

As you can see below user named Punisher admits that he’s created that page. The supervisory board members are sure that BTG-enthusiasts, who want the price to go up, will increase the pressure on them.

Main BTG developer h4x3rotab has cited threats by victims as an excuse to end negotiations over any form of refund.

The letter with demands sent to the core team was ignored, so the supervisory board of “Crypto-ombudsman” has decided to sue each member of the team for alleged complicity and negligence.

Despite the decision, victims still don’t seek to destroy the project with such a technology, but only to return money. Unfortunately, they have to take legal and public actions to obtain justice.

  • Alpha Q Up

    I have been watching this story for sometime and 3 weeks ago I have dumped my BTG because of this. I do not want to invest into something like that. What happened to a friendly fork? it does not seem that friendly. I can only imagine what those people are going through.

    • Zhivko Kostadinov

      Well, people like you who fail to read, can only lose. I am glad you dumbed your btg, since apparently you are too dumb to own them.

    • ricky

      These people are just trying to transfer their victim status onto someone else. They do not care to accept any responsibility for their role in this situation. I thought forklog may have been a credible website, but it is obvious to me it is not. In either of the “stories” fed to them by this group, did they try to contact BTG devs for comment? It really seems that they are publishing whatever is given to them and not fact checking of any of it.

  • ballzack

    They gave away their bitcoin, they did it themselves. Welcome to the wild west! Legal and public actions…. that is not really gonna help don’t you think?

  • Zhivko Kostadinov

    Anyone that lost money from this website scam just getting punished for their greediness. To get their BTG so they can sell it on high prices. And now they moronic brains fart yet another moronic action. To sue a group of people who included a third party link in their website. Good luck!

  • ricky

    Hello,

    I am a member of the BTG community. I
    am not a developer and do not have any official possition with or
    ties to the BTG development team. I have been a BTG miner since the
    moment BTG launched and have also been an active member in the
    official BTG slack channel since before launch. I will first state my
    observations, that I feel are statements of fact.

    BTG has assisted many developers
    to have their applications be able to interact and work with the BTG
    blockchain. This was in no way unique to John Dass.

    BTG posts compatible pools,
    exchanges and wallets on the BTG website and on social media. That
    this wallet got posted was not unique to Mybtgwallet.

    John Dass was never a member of
    the BTG development team. He did have developer as part of his user
    created name in the slack channel, and I assume BTG was OK with
    this because he was a wallet developer.

    Users should have followed the
    following basic, common sense and common knowledge steps for example
    moving BTC out of the wallet before sweeping their wallets for BTG.
    This should have been done regardless of the BTG wallet they wished
    to use. Also a cached version of the website showing how it appeared
    on Nov 12 shows that there were other wallets available on that site
    on that date. It was not just the scam wallet and the core wallet,
    there were four additional wallets available.

    John Dass changed the coding of
    the wallet adding the scam portion of the coding AFTER his coding
    had been reviewed by the BTG team and the wallet had been added to
    the website.

    While you did, and still do, need
    to download the full node (about 147 GB) to be able to use all the
    features of the Bitcoin Gold core wallet, you did not need to
    download the full node to generate a paper wallet. Mining funds
    could have been sent to a paper wallet generated by Bitcoin Gold
    core wallet. This fact makes this portion of your story factually
    incorrect.

    The BTG team has not been
    unresponsive. They have offered to pay the legal costs and fees to
    track down the scammer. This offer was not acceptable.

    Do not misunderstand I feel sorry for
    anyone that was scammed. But I can not support this groups methods or
    demands of the Bitcoin Gold team. This group claims that because the
    wallet was listed on the website or posted on social media that makes
    the Bitcoin Gold developers responsible for repaying their losses.

    They say that because they followed a
    link on the the Bitcoin Gold website. No other facts that I stated
    above matter. They have been emailing exchanges asking them not to
    support BTG and informing the BTG team that they will contact them
    and recommend otherwise if the team pays them their losses out of the
    teams personal funds. I feel this is blackmail.

    From their letter, “As well, the
    Bitcoin Gold Team removed all links from their website and deleted
    social media posts (twitter) regarding the compromised online wallet
    mybtgwallet.com after some users began to claim that their wallets
    were emptied. “ I guess they feel this helps establish the BTG
    team’s guilt. I feel it helps prove they were acting responsibly.
    After they became aware that code had been added to the wallet to
    make it a scam, what reasonable, honest person would leave up
    anything promoting that scam? Of coarse anything pointing to this was
    taken down to try to prevent anyone else from being scammed.

    I have also been monitoring the
    StolenBTC group slack. They claim to have a lawyer that will be
    filing a class action lawsuit. To be involved in this you have to
    provide one of the members on slack several things including your
    hacked wallet address, and a copy of your ID. Someone came in
    claiming to be a victim, but was opposed to providing the ID to
    people on slack. This individual asked for the lawyer’s phone number
    to contact the lawyer directly. A member @ Kryptosaurous Rex gave a
    number and said to ask for Joe. A simple google search revealed the
    number was the number to a pizza shop in New York owned by a Joe. I
    have witnessed people in the slack discussing how to destroy
    confidence in BTG and another user say “I much rather see BTG
    reduced to nothing”. I have seen them make false statements, and
    partially true statements to implicate BTG staff, while leaving out
    the parts that make them appear not guilty. It is my opinion that if
    they sue, they could be counter sued for defamation and blackmail. As
    a side note to them, you should only state the complete truth. If you
    pursue this based on lies and purposefully omitted portions of the
    fact, you could lose more than you already have. You have been
    scammed, you should not lower yourselves to that level. Also, “I
    much rather see BTG reduced to nothing”, do you not realize this
    would result in a lot of other people losing money due to your
    actions and careless attitude?

    To my knowledge, everything I have
    stated here is true.

  • ricky

    This more propaganda by a member of the group of Mybtgwallet scam victims. They got scammed and I feel terrible about that. But lets be honest about the facts. A person who not a member of the BTG development team created the wallet. The development team listed the project on the BTG site along with other wallets, pools and such that were created to support Bitcoin Gold.After listing the creator of the wallet changed the code to steal private keys. The users used the wallet to claim their BTG, with out first removing their Bitcoin. The scammer then stole their Bitcoin. I see the scammer as the main guilty party. The next one is the people that did not exercise common sense and gave up private keys before removing their Bitcoin. This group of people is now demanding the BTG developers now repay them. They have been anything but pleasant. It has been said that repayment must be made or they will try to hinder the project and they have threatened lawsuits. What they did id the equivalent of taking your car to a mechanic and leaving a large sum of money on the passenger seat. When they realize someone took the money they then threaten the person that recommended that mechanic. They accept no responsibility. They want the only victims of the scam to be the developers. At this point I think the developers should sue every one of them individually for defamation.

  • ricky

    What kind of site would publish a story without giving the authors name?