On-chain investigator ZachXBT shared details of a massive cryptocurrency Ponzi scheme that extorted more than $150 million from unsuspecting victims before it collapsed last week.
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The mechanics behind a $150 million crypto Ponzi scam
In a series of X posts, ZachXBT unveil Details of a Ponzi scheme that had been operating under DSJ Exchange (DSJEX), a fake trading platform, and BG Wealth Sharing, a fraudulent investment scheme, since 2025. The scam involved a fake CEO named Stephen Baird, a self-proclaimed professor who represented the platform to the public.
According to Tuesday’s thread, DSJEX and BG Wealth reported daily returns between 1.3% and 2.6%, with referral commissions and rank-based bonuses. Additionally, Beard spread fake hiring and trading signals through a group on the messaging app BonChat in Hong Kong.
Washington State Department of Financial Institutions (DFI) recently He explained That investors used these trading signals on the DSJ exchange and were led to believe that cryptocurrency investments were generating returns.
BG Wealth and DSJ claimed to be licensed by the US Securities and Exchange Commission (SEC), but DFI found that none of the forms filed by those companies indicated they were registered with the SEC.
Thirteen regulatory bodies across five continents have issued public corporate fraud warnings, including the UK’s Financial Conduct Authority (FCA), the Australian Securities and Investments Commission (ASIC), the Securities and Exchange Commission of the Philippines, and the DFI in Washington.
On April 23, US law enforcement seized one of BG Wealth’s domains as part of a joint operation conducted by Operation Level Up and Scam Center Strike Force. However, to cheat Continue working for about another week.
Last Saturday, Baird posted a video confirming that the LSE would soon go public and called for a 12% “tax” on account balances as a prerequisite for the regulatory process. But scammers have already disabled withdrawals by this point.
Tether, exchange freezes $41.5 million
After the involvement of the American authorities by malicious actors Washed Over $92 million in cross-chain crypto assets. ZachXBT noted that scammers regularly alternate between domains and hot wallets to evade law enforcement.
Between April 27 and May 3, cryptocurrency funds were laundered through token swaps, blocking via Bridgers, Butter Network, and USDT0, wrapping and unwrapping USDD, and consolidating transactions across hundreds of addresses.
Crypto Investigator tracked millions of outflows through timing analysis, located Solana/Tron deposits at Binance, and found matching Tron withdrawals. He then provided the details to relevant parties, including Tether, Binance’s security team, OKX, and US law enforcement.
As a result, the rope I froze $38.4 million was frozen on May 4, while another $3.1 million was frozen on various cryptocurrency services and exchanges, bringing the total to $41.5 million.
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Despite the significant recovery, the on-chain investigator noted that the scam’s $150 million valuation “is likely much higher given that the scheme has been operating since 2025, with thousands of victim exchange withdrawals identified.”
Ultimately, he advised victims of the DSJEX and BG Wealth scheme to file a police report in their jurisdiction to assist with global investigations and potential compensation from the laundered proceeds.
Featured image from Unsplash.com, chart from TradingView.com
