Self Chain Founder Terminated for $50 Million Crypto OTC Scam Targeting VCs and Influencers

A $50 million over‑the‑counter (OTC) crypto scam—once thought perpetrated by an anonymous "Source 1"—has now been linked to Ravindra Kumar, founder and CEO of Binance‑listed blockchain project Self Chain.

The scam involved well-known tokens such as SUI, NEAR, Axelar, SEI, and others, and targeted a wide range of victims, including venture capitalists (VCs), key opinion leaders (KOLs), and crypto whales.

Numerous investors reportedly committed over $1 million each. Some victims are now facing life-changing financial losses, and there are reports of severe emotional distress among those affected.

Let’s break down this massive scam step by step through its timeline to understand how it unfolded.

Scam Timeline & Mechanics

Phase 1: Building Trust (November 2024 - January 2025)

The scam began with seemingly legitimate OTC deals shared in Telegram groups by venture capital groups and private investment pools.

These deals offered tokens like Graph (GRT), Aptos (APT), and SEI at steep discounts of up to 50% below market value, with a vesting period of 4-5 months.

Early transactions were fulfilled successfully, building trust and encouraging further investments.

Phase 2: Scaling Up (February - June 2025)

As confidence grew, the scam expanded to include tokens such as SUI, NEAR, Axelar, and others.

The structure of the deals remained consistent, and the operation attracted even more investors, scaling the scam to unprecedented levels.

Phase 3: Ignored Warnings (May 2025)

By May 2025, cracks began to appear. Industry leaders issued warnings about the legitimacy of these deals. For example, Eman Abio from the SUI team explicitly cautioned against fake Telegram OTC deals.

However, these warnings were largely ignored as investors continued to pour money into the scheme.

Phase 4: Collapse (June 2025)

The scam unraveled on June 1, 2025, when token distributions for older deals stopped. Investors were met with vague excuses about delays.

On June 19, Aza Ventures, a leading VC group involved in the deals, announced they too had been scammed. They revealed that their primary dealer, known as "Source 1," had been running a Ponzi scheme, using new investments to fulfill earlier commitments.

From Anonymous Broker to Identified Suspect

On June 23, Self Chain officially terminated founder and CEO Ravindra Kumar, stating he "will no longer hold any position, responsibility, or association with Self Chain in any capacity going forward" following revelations that he was suspected to be "Source 1" in a $50 million OTC scam.

Between June 19, when suspicions against Kumar emerged, and June 23, when Self Chain officially confirmed his removal, the SLF token plunged from approximately $0.131 to a low of $0.084—marking a decline of over 35.9%.

Scam in Broader Context

Motley Fool reports nearly 30,000 crypto investment scams occurred in Q1 2025 alone, resulting in approximately $1.5 billion in losses. This figure represents a 300% increase compared to the same quarter in 2022, signaling an alarming growth trend.

The average loss per victim has climbed to $8,900, indicating that scams like this OTC fraud are increasingly targeting high-net-worth individuals and institutions.

Most scams originate via social platforms like Telegram and Discord—the same channels used in this case—highlighting how informal OTC spaces remain a blind spot for due diligence.

Why Even VCs Get Caught

The Aza Ventures case exposes how OTC crypto deals—especially those involving vested tokens—remain fertile ground for exploitation. Trust is often built through exclusive private channels, early payouts, and seemingly credible intermediaries. But the lack of on-chain transparency for vested tokens makes verification nearly impossible, even for experienced investors.

This scam underscores a painful reality: Greed, FOMO, and overconfidence can cloud judgment — no one is immune, not even VCs or KOLs.

Key lessons：

• Always perform chain-level due diligence, even for OTC deals.

• Verify counterparties—especially for complex vesting schedules.

• Be skeptical of “too-good-to-be-true” offers tied to name-brand tokens, steep discounts, or celebrity endorsements.

In a space built on trustless systems, falling for trust-based scams remains the industry's Achilles' heel.