Confido, an Ethereum-based startup has disappeared from the internet after raising funds of over Rs 2.4 crore for its cryptocurrency.
The little-known company had raised the amount from investors after offering its CFD tokens during a three-day initial coin offering held earlier in the month. But according to a report in Cryptocoins News, all social media profiles and websites of the startup has been taken down pointing towards a possible exit scam.
The firm had earlier raised funds by presenting itself as an establishment that develops smart contracts and acts as an escrow between a buyer and seller during a transaction. During the offering period, the value of the CFD tokens had reached as high as Rs 77 per token, but from that point onwards the situation started to take a turn for the worse.
On 19th November, a post appeared on Confido’s Medium page revealing the crisis that was taking place inside the firm. The post, which was written by company founder and CEO, Joost van Doorn informed readers that it was facing legal trouble.
“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 adviser 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,” read the post.
Soon all traces of the company started to vanish from the cyberspace and those who searched for company’s accounts on social networking sites like Facebook and Twitter among others discovered them deleted. Also, the initial probes by netizens revealed that many claims made by the company officials were either fake or unverified.
According to TokenLot, which had managed the ICO for Confido, the company has likely pulled a scam. TokenLot had traced the flow of funds to an account with Bittrex and has filed a complaint with the FBI to gain more information about the account.
The price fell to Rs 1.3 per token leading to heavy financial losses to the investors who had backed the firm.
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