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3 P2P and Crowdfunding platforms that failed

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Kuetzal and Envestio


Early indications of potential risks



Peer-to-peer lending and crowdfunding (crowdlending) are new financial instruments that provide attractive returns with little effort. These two financing models served as alternatives to banks, allowing them to lend money while also providing SME or individual borrowers with more capital access.

The problem is that, unlike banks, the industry was unregulated. As a result, the entry barrier was low, and anyone with software, a basic understanding of the business model, and the desire to build a crowdfunding or peer-to-peer lending platform could do so. Not all of them had good intentions, as a lack of regulation was frequently used as an opportunity to engage in fraudulent activities.

Much has changed since then, and regulations have been implemented in the majority of European countries, greatly reducing the possibility of investors being tricked by fraudulent projects. Nonetheless, platforms can underperform, make poor business decisions, and declare bankruptcy, jeopardising invested funds. In the last few years, platforms such as ViVentor, Wisefund, Grupeer, and Monethera have been accurate examples; let's look at some of the three most popular ones that have failed.

Kuetzal and Envestio

2020 was a bad year for crowdfunding investors because these two platforms vanished with the money. This served as a wake-up call to everyone, reminding them that any investment involves risk, and those risks are significantly higher in unregulated markets like crowdfunding.

Both projects started out like any other crowdfunding platform, advertising themselves, offering new projects, paying interest payments, and communicating with investors, but there were early indications of events that would take place in 2020. One of them is the use of extremely high interest rates of up to 25%, as well as a lack of documentation for each investment project. Several Envestio projects were discovered to be fraudulent and non-existent. This indicated that the majority of investors do not pay attention to the projects in which they invest.

Overall there were multiple red-flags in Envestio:

  • Claim that 5,715 registered Investors had funded € 14’8 million towards the projects and received € 726' 240 in interest = 4.9%, considering a claimed Average Interest Rate for Investors is 18,71%.

  • Interest rates had begun from 15% up to 23%, while the average Interest Rate had been over 18.5% - Suspiciously high return.

  • Envestio claimed it had been sufficiently capitalized to execute any buyback immediately.

Regarding Kuetzal, there were the following red-flags:

  • Interest rates do vary from 6% to 21% - indicating unusually high potential return.

  • High interest rates for funding businesses that don't have high margins. It just makes no sense.

  • Impossible combination = high interest (20%) together with Buyback guarantee.

  • Lack of information about available investment projects.

Envestio and Kuetzal investors are yet to receive their funds.


Grupeer, which was once seen as an alternative and competitor to Mintos, was revealed to be a scam project in 2020, which surprised many investors. This platform functioned as a marketplace, allowing users to invest in various loans originated by their partners. Loans were of lower quality than those available on the aforementioned Mintos, and two in particular were suspicious: Finsputnik and Primo Invest. Grupeer had a stake in both of these businesses. Grupeer later unintentionally admitted guilt, saying, "Owners of Primo Invest refuse to communicate and took advantage of the situation to avoid liabilities." Despite the fact that the platform was clearly designed as a scam project, Grupeer blamed the COVID-19 pandemic.

Few Investors did experience Fund withdrawal processing issues as well as concerns about a lack of Buyback Guarantee, however their general opinion about the platform has been well established due to well executed service, nevertheless lack of transparency and limited documentation were the early red flags.

Early indications of potential risks

  • Envestio was purchased by German-mysterious investor.

  • There were sudden changes in Terms and Conditions. (Envestio)

  • Paid tax amounts for these platforms were very low compared to investment portfolios, statistics provided in their annual reports and web-page.

  • After “DDOS attack” there was no communication with investors from Envestio. 

  • Multiple loan originators(projects) had tax debt issues.

  • There was no public information on owners of Envestio 

  • Had promised that investors could cash out at any time for a 5% fee.

  • Had no information about annual reports.

  • New COO appointed prior to incident with lines to previous schemes. 

  • Limited info about investment projects.

  • Three projects had the same owners.

  • Different information provided about owners in their web-page.

  • Most of the partners had min share capital. 

  • Different addresses(actual and registered)

  • Did not provide any explanation about fake loan originators/projects.

  • Changed payment institutions(Grupeer)

  • Completely different information about loan originators/projects in the platform page and loan originators page.

  • Multiple fake loan originators web-pages were built by similar technologies, similar code and design. 


While distinguishing between reliable and untrustworthy investment platforms can be difficult, only experience and knowledge can help you detect fraudulent activities and make better investment decisions and reduce risks in P2P Lending industry. Overall, all platforms shared one characteristic: a lack of transparency. This is the primary criterion Sneakypeer uses in its scoring, which we believe will significantly reduce the amount of money lost on such platforms.