Fun

El Salvador Chivo Wallet Programmer Opens Up About Alleged ID Fraud, Tech and Money Laundering Issues

News Feed - 2023-01-13 08:01:32

El Salvador Chivo Wallet Programmer Opens Up About Alleged ID Fraud, Tech and Money Laundering Issues


A Chivo wallet programmer has opened up about the different problems that the flagship cryptocurrency wallet of El Salvador faced during its initial stages. Shaun Overton, who alleges he was hired to help in the handling of the issues, has talked about ID theft, money laundering problems, and the tech issues he observed while working with the Chivo team. Chivo Wallet Problems Deconstructed


Shaun Overton, a developer that supposedly was part of the team for Chivo Wallet, has talked about the different problems that the flagship cryptocurrency wallet, created by the government to popularize the use of bitcoin as legal tender in the country, faced during its initial stages. The statements offered by Overton are part of a legal dispute between Accruvia, a software developer, and Athena Bitcoin, the company in charge of developing and operating Chivo Wallet, which was replaced by Alphapoint in February.


According to the local news site El Faro, Overton was brought in by Chivo’s team to manage problems in the aftermath of the launch of the project, which was “in flames.” One of the first problems had to do with the implementation of KYC (know your customer) procedures, which allowed anyone to check in with a Salvadoran IP address and a Salvadoran ID document.


This resulted in a series of ID thefts that led to fraud because the application offered a $30 bonus for new signups. Overton stated: We never established the exact amount of fraud, but we estimated that 10 to 20 percent of registered users were fraudulent.


El Faro estimates the amount that was fraudulently withdrawn to be more than $10 million, and there is currently a lawsuit in progress introduced by Cristosal in November on this issue. More Missteps


The system also had more problems that affected its primary function and allowed threat actors to take advantage of these flaws. The wallet only updated the price of bitcoin once per minute, a bug that allowed people to arbitrage using other price sites to benefit from the non-reported price changes. Overton stated that this caused a “hemorrhage of money,” and gave examples of users that started with $2,000 and managed to get $400,000.


He stated: Since the Chivo Wallet ecosystem did not compensate for the market risk, all the profits of these people came from the government of El Salvador.


Also, Overton affirmed the Chivo Wallet team willfully turned off the KYC filters when the system failed, to allow the app to achieve its goal of having 50,000 users registered, and allowed people to transact money to bank accounts without reporting it due to a bug in the app. Overton concluded that the app was “full of fraud.” Tags in this story accruvia, Arbitrage, Atheha, chivo wallet, El Salvador, ID theft, Money Laundering, Shaun Overton


What do you think about the allegations of Shaun Overton on the issues that Chivo Wallet faced in El Salvador? Tell us in the comments section below. Sergio Goschenko


Sergio is a cryptocurrency journalist based in Venezuela. He describes himself as late to the game, entering the cryptosphere when the price rise happened during December 2017. Having a computer engineering background, living in Venezuela, and being impacted by the cryptocurrency boom at a social level, he offers a different point of view about crypto success and how it helps the unbanked and underserved. Coinbase Shutting Down Most Crypto Services in Japan After Series of Job Cuts Globally EXCHANGES | 18 hours ago Bankruptcy Court Terminates FTX Naming-Rights Agreement for Miami Heat Arena EXCHANGES | 1 day ago


Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleBelarusian Fined $1 Million for Illegal Crypto Trading Next articleForbes Gives Alchemy Pay Web3 Innovation Pioneer Award Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItRipple CEO: SEC Lawsuit Over XRP "Has Gone Exceedingly Well"


The CEO of Ripple Labs says that the lawsuit brought by the U.S. Securities and Exchange Commission (SEC) against him and his company over XRP "has gone exceedingly well." He stressed: "This case is important, not just for Ripple, it’s ... read more.Oman to Incorporate Real Estate Tokenization in Virtual Assets Regulatory Framework Goldman Predicts US Recession Odds at 35% in 2 Years, John Mauldin Wouldn"t Be Surprised if Stocks Fell 40% Survey: Adoption in Argentina Grows, With 12 out of 100 Adults Having Invested in Crypto Iran to Increase Penalties for Unauthorized Cryptocurrency Mining

News Feed

Ukraine’s Largest Bank Suspends Money Transfers to Crypto Exchanges
Ukraine’s Largest Bank Suspends Money Transfers to Crypto Exchanges Privatbank, the largest commercial bank in Ukraine, has temporarily halted transfers in national currency to d
Erratic Processing Power: Bitcoin’s Hashrate Gains 45% in a Day, Then Loses 41 Exahash
Erratic Processing Power: Bitcoin"s Hashrate Gains 45% in a Day, Then Loses 41 Exahash Seven days ago Bitcoin’s network difficulty saw the largest drop in
MultiversX and Cornell launch sponsored blockchain education program
Tristan Greene7 hours agoMultiversX and Cornell launch sponsored blockchain education programOnce students complete the course, they’ll be eligible for follow-on mentorship, support and funding.705 Total views6 Total s
xSigma DEX Launch: More Than $100M in Liquidity Pooled on First Day
xSigma DEX Launch: More Than $100M in Liquidity Pooled on First Day press release PRESS RELEASE. xSigma, a decentralized exchange for stablecoin swaps, has succes
Zain Jaffer8 hours agoMark to market accounting meets crypto: New FASB changesThe volatility of Bitcoin and other cryptos is really more a function of who is buying and selling these assets.346 Total viewsListen to artic
Helen Partz9 hours agoFTX hacker moves $120M amid Sam Bankman-Fried trial: ReportBlockchain analytics firm Elliptic didn’t rule out the possibility of the $477 million hack being an FTX inside job.3240 Total views14 To
Ethereum Price Declines Despite Record Staking And ETF Activity
Este artículo también está disponible en español. Recent Ethereum market swings have revealed an interesting disparity between price and network activity. Staking activit
41% of top ZK airdrop wallets have already sold everything — Nansen
Jesse Coghlan3 hours ago41% of top ZK airdrop wallets have already sold everything — NansenThe data covered the “top 10,000 addresses” that received zkSync’s new ZK token, though that only makes up 1.4% of the t
EigenLayer partners with Ritual to build AI-enabled DApps
Zoltan Vardai10 hours agoEigenLayer partners with Ritual to build AI-enabled DAppsThe partnership will bring new AI capabilities to decentralized applications.3107 Total viewsListen to article 0:00NewsOwn this piece of c
Elon Musk Is First in Line as Ukrainian NFT Museum MetaHistory Launches Hall of Fame
Elon Musk Is First in Line as Ukrainian NFT Museum MetaHistory Launches Hall of Fame Elon Musk is the first inductee into the Ukrainian NFT Museum MetaHistory’s Hall of Fame
Turner Wright2 hours agoCoinSmart president says crypto taxes are a ‘little bit more favorable’ outside USAccording to Jeremy Koven, Canadian crypto firms may have a better regulatory environment than ones in the Uni
Marcel Pechman2 hours agoBitcoin price at risk? US Dollar Index confirms bullish ‘golden cross’Concerns over the U.S. dollar’s impact on Bitcoin may be overstated by investors, particularly in the longer term.1597