Allegedly the controlling entity prints 250 million units of some artificially scarce trashcoin called MOB (coincidence?) of which the issuing organization controls 85% of the supply. This token then floats on a shady offshore cryptocurrency exchange hiding in the Cayman Islands or the Bahamas, where users can buy and exchange the token. The token is wash traded back and forth by insiders and the exchange itself to artificially pump up the price before it’s dumped on users in the UK to buy to allegedly use as “payments.” All of this while insiders are free to silently use information asymmetry to cash out on the influx of pumped hype-driven buys before the token crashes in value. Did I mention that the exchange that floats the token is the primary investor in the company itself, does anyone else see a major conflict of interest here? Let it be said that everything here is probably entirely legal or there simply is no precedent yet. The question everyone is asking before these projects launch now though is: should it be?
I think I speak for many technologists when I say that any bolted-on cryptocurrency monetization scheme smells like a giant pile of rubbish and feels enormously user-exploitative. We’ve seen this before, after all Telegram tried the same thing in an ICO that imploded when SEC shut them down, and Facebook famously tried and failed to monetize WhatsApp through their decentralized-but-not-really digital money market fund project. The whole Libra/Diem token (or whatever they’re calling its remains this week) was a failed Facebook initiative exploiting the gaping regulatory loophole where if you simply call yourself a cryptocurrency platform (regardless of any technology) you can effectively function as a shadow bank and money transmistter with no license, all while performing roughly the same function as a bank but with magic monopoly money that you can print with no oversight while your customers assume full counterparty risk. If that sounds like a terrible idea, it’s because it is. But we fully expect that level of evil behavior from Facebookers because that’s kind of their thing.
Read more of this story at Slashdot.