(Yicai) Feb. 28 -- MetaForce, a decentralized online platform that offers various services such as cryptocurrency, non-fungible tokens, gaming and Web3, is taking China by storm as the price of Bitcom rebounds, forcing Chinese regulators to remind people of the dangers of pyramid schemes and fundraising scams.

MetaForce is a spin-off of Forsage, a smart contract program launched in February 2020 by Lado Okhotnikov, who in February last year was convicted of operating a Ponzi and pyramid scheme involving as much as USD340 million by the US Department of Justice. Forsage was also kicked out of the Philippines’ central banks in 2022.

Despite the regulatory backlash, MetaForce, which was launched in July 2022, is gaining ground in as many as 100 countries and has amassed 1.3 million investors so far. And it is proving very popular in China.

At its heart is a cryptocurrency called ForceCoin, which runs on the Ethereum blockchain. Depending on the amount people invest, they are awarded different membership levels and a certain amount of ForceCoin, a senior merchant promoting the project told Yicai.

Owners of ForceCoin can expect a huge pay-back when the virtual coin goes public, as its value is expected to surge over 500-fold, the person said. Buyers can also get returns from the membership program, as they get kickbacks when they bring other people into the scheme. The higher their membership level, the more the kickback, and above a certain level they can receive payments for introductions from those in the chain below them.

This is very similar to a pyramid scheme, a coin trader said.

People have been found to introduce others to buy ForceCoin and this is similar to a pyramid scheme or a form of swindling, the office in charge of cracking down on illegal financing in Pucheng county, central Shaanxi province said in November last year.

People need to keep an eye out for Metaverse-related activities that could be connected with illegal fundraising, fraud and other law-breaking actions, the Dalian branch of the country’s securities regulator said on Feb. 4.

ForceCoin is traded through BitgetWallet, a cryptocurrency wallet that is only available on the TestFlight app on the Apple AppStore. Developers can invite up to 10,000 users to test an app on TestFlight and so bypass AppStore restrictions, an insider said.

Purchases and sales of ForceCoin are carried out through Dai, which is an ERC20 token on the Ethereum blockchain that has a steady value of one US dollar. Transactions between ForceCoin and Dai were carried out manually for a short while, the person said. ForceCoin is not traded on an exchange so there is no stable public exchange market.

Editors: Xu Wei, Kim Taylor