Authorities in China's Hunan Province are investigating the activities of blockchain fitness app Qubu in connection withreports of illegal fundraising and financial fraud.
There are some tokens in the application -“candy” that is given to users when they complete the challenge of walking 4,000 steps for 45 days. According to regulators, these “candies” are a financial instrument with a promise of a return of 36.8% in 60 days.
Qubu application has a user base in95 million users, with a registration fee of 1 yuan. The number of tokens is limited to 1 billion units, while the application has an integrated market where “sweets” can be sold and bought for real money. Commissions for trading in this market can reach 25% -30%.
One user invested about $2,150 with hopes of profit, but after investigation, his funds are likely to be lost.
Although the developers claim to be used inblockchain application, tech observers believe Qubu has little in common with distributed ledger technology. This is not surprising, since of the 25,000 blockchain companies in China, 70% have only attempted to release their own cryptocurrency and only 4,000 have been working on practical blockchain applications.
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What is proof of activity (PoA)?