Cryptocurrency Exchange to Pay Back Victims of an Apparent ICO Scam
Nov 29, 2017 Posted / 3530 Views
Kucoin, a cryptocurrency exchange Platform has announced that it will pay back user investment towards the Confido ICO which was channeled through its platform. The ICO market has witnessed the first of its kind ICO scam after the developers of the Confido Project revealed that they were dishing out the project. As a result of the announcement the CFD Token price dive by over 95% making the people who invested in the project feel defeated and cheated.
Given the number of investors who lost their money in this project indicates that something needs to be done in the ICO sector to prevent his vice from repeating itself in the Future. But luckily for this project, some of the Investors have a reason to smile as Kucoin Announced that it will reimburse those investors who channeled funds for the ICO through its platform. Its seen as an act of charity done by Kucoin since it was not responsible for creating the CFD tokens yet it confided to remove money out of its own pocket to compensate users who lost money in the scam.
On the other hand, Kukoin was listed as one of the Exchanges were CFD tokens would be traded making the company bear some legal responsibilities associated with the scam. The move by Kucoin to Pay investors who send money for the Confido ICO through platform will help the company avoid any legal challenge associated with the apparent scam thus maintaining its reputation clean.
Kucoin gave the announcement saying,
“ We have tried several times to establish a dialogue with the cofido team but our best attempt has yielded nothing so far. we will now provide users with an emergency solution to ensure user interests is respected and minimize losses in the CFD investment. For the KuCoin users who had made CFD trades, we are going to trade users’ purchase net value at the rate of 0.0000038 BTC (approximately $0.03)/CFD and directly deposit into users’ accounts.”
This case Just raises more terrible Questions about ICO and how fake projects tailored to extort money from people can be avoided in the fundraising platform. At the international scene, many countries are still hesitant to support ICO while other support it with stringent law and supervisions. It is a good idea for companies who want to receive funding via ICO to disclose Biodata about its development team, this way any such when the company decides to call off their projects appropriate measures can be taken so as user funds can be retrieved.
Inadequate regulatory oversight coupled with the incredible popularity of cryptocurrencies and ICO will still allow for fraudulent ICOs to transcend. Meanwhile, regulators are taking notice of the event happening in the ICO ecosystem. Recently the European Securities and Markets Authority (ESMA) revealed a concern that ICOs may be violating the law of very many countries in the European Union. Its counterpart the Security exchange commission of the United States announced the creation of a new cyber unit tasked with overseeing a broad layout of events including activities in the ICO ecosystem.
Some cryptocurrency forums have been circulating Rumours that Confido itself would pay back the funds users invested into its project. This follows the circulation of a dubious letter purportedly issued by a law firm representing Confido. So far no verification has been made on the validity of the letter rendering the entire rumor another big lie.
Applancer is an open platform for discussion on all things like Blockchain , Cryptocurrency and Ico news updates. As such, the opinions expressed in this article are the author's own and do not necessarily reflect the view of Applancer .
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