Confido, more like Confidon’t!
Confido, the cryptocurrency start up that wanted to provide a payment processing system to it’s users has vanished with their investors hard earned cash! The startup’s mission tag line was “safe and trust-less cryptocurrency payments, it’s possible with Confido.
Confido, which may have been a short form of confidence scheme, raised about $375,000 via the fundraising vehicle of an initial coin offering and simply ran. It’s sort of like they’ve implemented a “take the money and run” strategy.
Confido described itself as a company that is creating “smart contract” to provide the services of becoming an escrow account between buyers and sellers during various transactions.
The startup, if it were really trying to chipping away at the problem, would have been tackling a rampant issue. Escrows these days involve three parties, the buyer, the seller, and the third party which will hold the funds in escrow. Smart contracts would allow for the elimination of the third party. In a smart contract there would conditions that would be inputted into the contract, and when both sides of the transaction meet all of their obligations, the contract would be fulfilled. In this sort of world, a potential third party finds themselves without a role and are not needed.
The company rolled out their ICO through Tokenlot on October 28th, the fundraising lasted until November 7th.
Raising around $375,000. The contributors to this project were provided “contract for difference tokens”.
The prices of the tokens fluctuated around $1.20 on the 14th of November but greatly decreased with the vanishing of the Confido team. Clicking on their website reveals an empty page.
‘Troubles with the law’
All accounts are leading up to the fact that this may have been a con job with the fund-raise being the exit strategy.
One will not be able to readily find any information about their whitepaper, their website or any other sort of online asset that was present and visible in the past. A potential interested user would not even find any form of social media presence.
But a recently surfaced Medium post shows that the company might have had legal troubles.
The team states “Thanks for always standing by us. We have achieved some incredible things these last two weeks, and the crypto space is beginning to notice us. However, we owe you an apology. Right now, we are in a tight spot, as we are having legal trouble caused by a contract we signed. We signed the contract with assurance from our legal advisor that there was minimal risk and it would not be an issue. I can’t and won’t go into details, but he was wrong. It is a problem.”
The author of the article signs off as Joost van Doorn, the CEO of Confido, but one would be hard pressed to find any social media profiles (linkedin or other) and any other relevant information about him online.
The latest that contributors may have heard from any member of the team may have been on reddit. According to CNBC, a person on Reddit who posted under the name “Chris-ConfidoSupport” claimed Monday to be a representative of Confido and said he has “absolutely no idea what has happened.” The Redditor claimed to have been in contact with van Doorn for a “number of weeks” and this latest move is “completely out of character.”
Many people on Reddit questioned the credibility of the post and whether the person had actually met the CEO.
TokenLot The facilitator of the ICO, Tokenlot, had a few words to say on the matter
“This morning we awoke to the unfortunate news that the team behind Confido has seemingly pulled an exit scam. TokenLot was hired by Confido to host their crowdsale and escrow the funds collected. The terms of our contract require all ICOs listed on our platform to show proof of token creation and distribution of tokens to investors, before the release of ETH collected during the ICO. On November 7, Confido demonstrated all evidence needed for the release of funds from escrow.
Fortunately, we have stumbled across one very positive lead. Blockchain analysis shows that the ETH that was collected and transferred to Confido, ended up being sent to an account with Bittrex.com. We have been in contact with Bittrex Management and they have confirmed that the account the ETH was sent too is an account where Enhanced KYC Verification was authenticated. Additionally, we are also in contact with KuCoin and gathering all intel we have for Joost and the possible team behind Confido.”
The company is conducting analysis and taking action to resolve the matter and prevent it in the future.
Final Thoughts: It’s necessary to highlight bad actors while understanding how to prevent this sort of behaviour without taking away from the inherent value of ICO’s and the decentralized system.
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