I just came across a particularly outrageous crypto project collapse event, and I want to share it with everyone. This project is called BlockDAG. It publicly claimed that it raised $442 million, but the CEO said himself that they only raised a little over $200 million—investors are now completely being kept in the dark.

The most attractive thing about this project to me is that they’ve partnered with a bunch of top football clubs—what they call sponsorship agreements, including with Inter Milan and Borussia Dortmund. They also made promises like having mining machines and getting tokens listed on 20 exchanges. It all looked especially aboveboard—so what happened in the end? Not a single promise was fulfilled.

What’s most heartbreaking is that, according to disclosed documents, at least $110 million was transferred to certain exchange accounts, another $7 million was moved out through token swap agreements, and $5 million went into DeFi protocols. As for where the funds went afterward, everything is a mystery. Blockchain industry insiders say this operation is especially abnormal. A project should originally keep the fundraising in auditable smart contracts—but they did otherwise, which basically leaves a loophole for cheating.

The situation with unpaid wages is even more outrageous. According to insiders, about 24 employees still hadn’t had their December wages settled last year, and the total amount owed in back pay exceeds $140,000. And it doesn’t stop there—football clubs also had their sponsorship fees delayed. Inter Milan ended its partnership with BlockDAG in June 2025 due to the outstanding payments, and they even sent a letter demanding that BlockDAG stop promoting itself as an official partner. Alpine Racing also sent a letter in November, saying BlockDAG owed $1.4 million in sponsorship fees. Borussia Dortmund is even worse—owed over €2 million.

Mining machine orders are also full of traps. According to the sales agreements with the mining machine vendors, more than $5 million worth of mining machine orders have not been delivered, including 2,550 units of the X30 and 2,250 units of the X100. Investors who paid several thousand dollars for mining machines still haven’t received them to date. One U.S. veteran, Reid Davis, invested $100,000—but the whole community only received about 20 prototype units.

The most interesting part is the background of the project founder, Gurhan Kiziloz. This guy previously worked on a fintech project called Lanistar. As a result, he was warned by the UK financial regulator for operating without authorization to conduct financial business, and his advertising was also accused of misleading consumers. That project claimed to raise $20 million, but it was later confirmed to have been just loans provided by his family. And now Lanistar has entered liquidation proceedings.

What’s interesting is that Kiziloz has also promoted a Meme coin called Big Eyes in the crypto space, and yet that coin is now down 98%. With this person’s track record, it’s hard to believe that BlockDAG could end up well.

At first, the project’s management team was completely anonymous. Later, they replaced it with a veteran CEO named Antony Turner to stabilize the situation—but it didn’t help either. Turner even said in emails that the delayed payments left him “with his reputation damaged,” saying he only paid a deposit for the X100 mining machines and didn’t pay a penny for the X30 mining machines. In the end, he was fired after the founder’s identity was leaked.

Now Kiziloz has come out to speak himself, claiming that they plan to end token sales by the end of December, and launch the mainnet in early February. But the project’s technical progress simply can’t keep up—the activity in the GitHub code repositories is only at a moderate level, and multiple repositories haven’t been updated for several months. Even the CTO directly said in a Q&A session that the timeline is too aggressive, and that there are still a lot of work that hasn’t been completed.

Investors have now reached their limit of patience. Some have started teaching people how to submit complaints to the UAE’s VARA, and others are sharing how to report to the UK and the British financial regulatory authority. This is a complete trust collapse process—from defaulting on football sponsorships, to filing complaints at the labor authorities for unpaid wages, from endlessly delaying promised mining machines, to token dilution—every promise is breaking one after another.

This case is especially worth paying attention to because it shows the most common problems that crypto projects are prone to: the fundraising numbers don’t match the actual fundraising, the flow of funds is unclear, management is chaotic, employees have unpaid wages, and business partnerships breach their agreements. If you’re considering participating in any crypto project, this event is the best negative example to learn from.