BitClub Network, following the late-2018 collapse of its cryptocurrency mining Ponzi scheme, now charges investors up to $3500 for access to purported trading algorithms. The company, which has seen declining activity, continues to solicit funds, primarily from individuals in Japan, South Africa, and China.
The surge in such automated trading tools has become a common tactic within the online investment underworld. Many entities now offer these bots, claiming they generate unlimited wealth on demand. Owners of these systems typically market access to others rather than solely profiting from the alleged bot capabilities themselves. By the time investors realize the bots do not work, their funds are often unrecoverable.
BitClub Network's version of this model includes several "Trader Packs." For $500, investors buy access to three algorithms and can invest up to $2000. A $1000 pack provides seven algorithms and an investment ceiling of $5000.
The offerings extend to a $2000 package for fifteen algorithms, allowing up to $15,000 in investment. The top tier, a "Trader Founder Package," costs $3500 for "unlimited algorithms" and permits investments up to $100,000. These fees are annual, paid in addition to an initial $99 BitClub Network sign-up fee and the capital invested.
Details regarding these "magical algorithms" remain scarce. The company provides no technical specifications or proof of their functionality, stating only that they trade Bitcoin. The new trading bot scheme is not visible on BitClub Network's public website, appearing only within the affiliate back office.
Despite a steady decline in activity over the past twelve months, BitClub Network's administrators continue to extract money from new investors. The company has operated for five years, originating from individuals previously involved in Zeek Rewards, a notorious Ponzi scheme shut down in 2012 by the U.S. Securities and Exchange Commission.
A key figure in the scheme's continued operation is Andy Nakashima. He has been actively promoting BitClub Network in Japan, a country that now accounts for 21% of the website's traffic, according to Alexa data from early March 2019. Nakashima appeared at a BitClub Network event in Japan weeks ago.
Nakashima, a California resident, is not registered with the U.S. Securities and Exchange Commission. Any offering of securities he makes, including those for BitClub Network, is unregistered and illegal under federal law. BitClub Network officially claims not to operate in the United States, a policy contradicted by Nakashima's alleged status.
Reports indicate Nakashima is one of BitClub Network's founders. This complicates any attempt to disassociate the company from his US-based activities and the legal implications of his promotions. Investors approached by BitClub Network should be aware that the promotion of unregistered securities by individuals like Nakashima carries significant legal risks.