With the value of ICO tokens falling down at an exponential rate, the exit scammers have stolen an approximate of $100 million in crypto scams.
Dia, a blockchain intelligence firm compiled a data that suggested that ICO scams worth an approximate of $96.8 million have happened over the past two years. Meanwhile, the blockchain startups have made more than $6.3 billion in 2018 from ICOs. Of all the thefts made, the Chinese company in the record Shenzhen Puyin Blockchain Group is responsible for accumulating $60 million in the name of three ventures. The three said companies named ACChain, Puyin, and BioLifeChain never actually existed.
Similarly, Cryptokami and NVO made $12 an $8 million in the name of the projects which they never made. The former has shut down its website, meanwhile, the latter has made no updates on its platform since March 2018. LoopX raised $4.5 million as it left off with the funds of the investors and blockchain powered vegetable startup Prodeum.
No regulations on crypto scams
There are very little means of any regulations that verify the authenticity of the projects that are being listed. Hence, Exit scams almost always fill the ICO space. In the space of ICO, there is no obligation made in legal terms to deliver a project after receiving the required funding.
The most common red flags that the exit scams manifest are very easy to identify. Some of them are fake employee profiles, plagiarized whitepapers and plagiarized imagery among many others. The Wall Street Journal also revealed that 19 per cent of the currently existing ICOs shows many of these signs. Thus, it is very important that we pay attention to every detail while investing in ICOs.