Crypto Assets OTC Trading Eyewash Exposed: Involving Multiple Well-Known Tokens, Losses Exceed 50 Million Dollars

Recently, an over-the-counter (OTC) Crypto Assets eyewash involving various well-known Tokens has been exposed. This eyewash involves dozens of Tokens such as SUI, NEAR, Axelar, SEI, and is estimated to have defrauded investors of over $50 million within a few months. Surprisingly, despite the scale of this incident, it has hardly sparked widespread discussion.

The list of victims includes not only ordinary investors but also venture capitalists, industry opinion leaders, and large holders of Crypto Assets. Here are the detailed steps of this eyewash:

Phase One: Building Trust (November 2024 - January 2025)

Starting from November 2024, some organizations began to launch seemingly legitimate high-end OTC transactions in social platform groups. These transactions claim to sell well-known project Tokens at a 50% discount off the market price, such as Graph (GRT), Aptos (APT), SEI, SWELL, etc., and promise a 4-5 month lock-up period.

This is the bait stage of the eyewash. The initial transactions are completed as promised, and investors receive their tokens on time. This apparent legitimacy quickly establishes trust, attracting more investors to join and increasing the investment amount.

Phase Two: Expand the eyewash scale (February 2025 - June 2025)

By February 2025, the coverage of OTC trading rapidly expanded. A new round of trading poured into social platform groups, with larger scales and a broader range of tokens, including SUI, NEAR, GRASS, Axelar, and more. The trading structure remained unchanged: significant discounts and fixed lock-up periods. These enticing conditions further attracted more investors and strengthened the credibility of the eyewash.

Phase Three: Ignoring Warnings (May 2025)

In May 2025, the eyewash began to show vulnerabilities. Some industry leaders issued public warnings. Eman Abio from the SUI team reminded users on social platforms to be wary of false OTC transactions, stating clearly: "There is no such transaction at all!" Lucian Mincu from MultiversX also issued a similar warning.

However, despite these warnings, the community still turns a blind eye to the danger signals. Attracted by past investment returns, success stories, and seemingly credible group participation, investors continue to flock to new trades.

Phase Four: Eyewash Exposure and Collapse (June 2025)

On June 1, the last known transaction was launched, involving Fluid Token. Meanwhile, the token distribution of early OTC transactions suddenly stopped. Investors seeking updates were only given vague excuses, such as travel delays, exchange issues, and verification problems.

On June 19, the venture capital group Aza Ventures, which led these transactions, publicly announced that they themselves had also become victims of an eyewash. Aza Ventures accused its main trader "Source 1" of operating a Ponzi scheme. According to Aza, the early transactions were genuine, but the later transactions completely relied on the funds of new investors to fulfill previous commitments - which is exactly the typical Ponzi scheme model.

Worse still, Aza Ventures further disclosed that their other deal sources "Source 2" and "Source 3" actually also obtained transactions through "Source 1".

List of Involved Tokens

Early trading (November 2024 - January 2025) includes Aptos, Sei, Swell, Coti, Kava, Fluid, OG, Aethir.

Subsequent trading (February 2025 - June 1, 2025) involves SUI, NEAR, Aptos, Sei, Highstreet, Altlayer, Kava, Grass, Movement, Bio, Sandbox, Graph, Ronin, Axelar, Celestia, LayerZero, Renzo, Beam, Conflux, Wormhole, Arkham, Adventure Gold, Immutable, Vana, Berachain, Virtuals, EGLD, Fluid, etc.

Mastermind Identity

Aza Ventures claims to have identified "Source 1". According to insiders, "Source 1" is suspected to be of Indian nationality and is reportedly the founder of a certain project currently listed on a trading platform. However, Aza Ventures has chosen not to disclose their identity publicly, instead opting to pressure them privately to return the stolen funds.

Losses and Impacts

The total loss amount of this eyewash is expected to exceed 50 million USD. It is reported that many investors have invested more than 1 million USD in a single transaction. Victims include individual retail investors, large holders in the crypto assets field, project teams, and venture capital firms. Some victims have suffered life-changing financial losses, and there are even reports that some have experienced severe emotional breakdowns due to this incident.

Follow-up Actions

Aza Ventures claims that they are in active negotiations with "Source 1" to recover funds, with the end of the month set as a deadline. Meanwhile, the broader crypto community is working to track relevant wallet addresses, identify accomplices, and uncover more evidence to hold the responsible parties accountable.

This incident has sounded the alarm for the encryption industry, reminding people of the huge risks they face when engaging in unregulated over-the-counter trading through informal channels. Although warning signals had emerged early and public warnings were issued, trust, greed, and the so-called social "proof" have become powerful weapons in the hands of scammers.

Currently, the entire community is holding its breath, hoping that justice can be served and that the victims can eventually receive refunds.