Scam Token, Dummy Exchange, Fake Team, Market & Trading Manipulation, Fake volume and so on....!
This is another write-up that exposes how another ICO project has taken advantage of the vacuum that has been created in crypto as well as the thriving peoples in order to perpetuate yet another scam in the crypto space.
OG URL: https://steemit.com/cgcxexchange/@edward.mike/cgcx-exchange-exposed-pt-1-scam-ico , This is the 3rd time uploading. Medium suspended 2 times, hoping steemit wont screw up. Fresh report with more evidences will be updated here.
However, it’s actually the most common scam in all of cryptocurrency and they may perhaps be one of the more egregious projects in the space when it comes to this. But this scam is a bit complicated, a well planned massive scam happening from the past 8 months, cheating the whole investors, traders and the crypto community.
We will go through all of the fraudulent activities involved in CGCX Exchange from top to bottom.
Summary of CGCX Scams
(1) It appears that CGCX never developed an exchange. (2) It appears that CGCX lack a dedicated technical team. (3) It appears that CGCX lack digital presence and social media activity. (4) It is proven that CGCX exchange is subjected to malpractices and fraudulent (5) It appears that CGCX whitepaper does not have any technical briefing of their exchange. (6) Realistically there is no hybrid crypto exchange running currently. (7) It appears CGCX was not able to maintain the timeline and fulfill the milestones. (8) It seems to be CGCX has violated the regulations of MAS by not collecting KYC/AML. (9) It appears that CGCX cheated investors by faking trading volume in exchange (10) It is proven that CGCX cheated people by faking market capital and volume of token (11) It appears CGCX is run by folks from India, no verifiable information regarding the past details of team is available (12) It is proven that CGCX cheated people by distributing tokens not as proposed in whitepaper.
CGCX ICO Stats
According to the ICO reviews,
”Cafin Global Crypto Exchange — CGCX, offers a state of the art, highly sophisticated hybrid platform. Unlike most exchanges that offer only cryptocurrency trading, CGCX is uniquely positioning itself in the blockchain world by providing four modules under single platform to offer wide services to its customers.”
- Main Sale raised 32.5 M$
- Main Sale Phase 1 raised 43,215 ETH
- May 7th soft cap reached USD $5 million
- May 15th raising USD $10 million
- Automated KYC/AML services from Identity Mind, All the clients and incoming Transactions are screened against known offenders’ databases across the globe.
- Users in the CGCX platform can use their CGCX Token(s) to vote for multiple tokens.
- CGCX Tokens can be used to pay the transactions fee for the trades executed in the exchange and earn discounts on the transaction fee.
- Deposits and withdrawals are handled through modals, or pop-ups.
- CGCX will also launch its own wallet that supports multi-currency payment in the CGCX ecosystem.
CGCX Team / Profile
CGCX hosted the ICO with a 20-member team including advisers, mentors, developers and executives. When doing a detailed social investigation, we came to know most of the above displayed members are not associated with CGCX. There are peoples from multiple organizations are included in the team that means either they have outsourced the entire works to different companies / peoples or they are just added these peoples randomly. Right after there token sale they have updated their team removing some profiles. We can confirm CGCX do not have in house team, even if the above displayed team is managed in-house then also the probability of doing a token sale and running an exchange through this people is low. The displayed developers are probably related with website / admin works. Six of the displayed team members belongs to India while two are foreigners. Also, there is no socially verifiable details available in public regarding the authenticity of these peoples. All of them seriously lack the profile that they were supposed to have.
No one of the founding members have any prior domain expertise related to cryptocurrency or blockchain or exchange or not even in any legacy firms either in financial or technology or business firms. Also, all of them lack previous history regarding entrepreneurship, employment, official and personal portfolio, etc. There is zero activity involved with these peoples prior to token sale.
Now it is clear why they haven’t updated their exchange and also why delaying in implementing the proposed features is because CGCX lacks a dedicated team. They never developed this exchange; this can be a white-label exchange.
Summary of Team/Profile
(1) They displayed peoples profile as team members which does not belongs to them, either they outsourced or they faked. (2) Entire CGCX team lack social media presence especially in crypto mediums also none of the team members have verifiable profile available also lacks past events. All profile are mocked up just for the sake of doing ICO. (3) Github account of CGCX is null, no events or members are found also it is funny that there PM Nabilah has made a commit requesting for listing CGCX token on Coingecko. (4) CGCX outsourced entire ICO, Exchange , Token work to different organizations. (5) CGCX team lacks domain expertise and knowledge, not even regarding traditional biz. No verifiable data is available. (6)Initial media presence was made prior to few months before launching ICO. (7) Domain name is only 1 year old, No online presence of CGCX till 2018.
Summary of Timeline
(1) Early investors have been invested on Jan 2018 as SAFT. (2) Main sales got extended till July 30 (3) Mobile Application never released (4) Wallet has never released (5) Voting engine never released (6) Smart contracts never launched (7) Merchant Solution never launched (8) Loyalty program never launched
Overview of CGCX Whitepaper
There Whitepaper is a carefully crafted colorful paper describing a lot of shits, there is not even one relevant information regarding the platform is present. Just some fancy words explaining the benefits of the exchange that they never build. It took less than 20 mins to finish out the whitepaper and We can’t believe with this kind of approach how the hell users got attracted towards CGCX. The entire people who invested in CGCX purely lacks understanding of crypto or blockchain, they just invested to make more money expecting CGCX will replace Bitcoin.
What is Hybrid Platform?
We are aware about two types of exchanges in the crypto industry, centralized (Binance, Bitfinex, Coinbase, and others) and decentralized (BitShares, Waves Dex, RuDex, and others). As the word’s “hybrid” says, it is a mixture of both centralized and decentralized exchanges. This kind of exchanges will be having a major support of centralized exchange features, and for addition this website will give free space for trader to trade directly from their hardware wallet (decentralized concept). This is upon the traders wish. To solve the problems of centralized and decentralized exchanges, hybrid crypto exchanges (HEX = Hybrid Exchange) are being developed, which will be based on the functionality and liquidity of CEX platforms, as well as the confidentiality and security of DEX platforms.
AFAIK, there are no specific working examples on the market including CGCX Exchange.
They also do claim “Fully Insured”, but couldn't find any official references anywhere regarding the details of Insurer. Initial analysis shows that several portion of CGCX token is vested under different accounts incl founders, team, investors etc including the Insurance Reimbursement.
So it was supposed to be “Fully Insured on CGCX Token”,
Funds are not SAFU !!!
In there W.P they displayed a basic system architecture of exchange claiming to be there. A publicly available architecture is proposed there by fooling all those investors, traders are the whole crypto community . Also, to be noted that they were able to release beta version of their exchange on June 2018. That is just before starting the main toke sale. They released public version after one month of trail, so things are pretty smooth, they were able to launch the exchange for public before starting the ICO.
Most of the ICO failed due to the failure of projects here CGCX managed to go live with a dummy product first and completed ICO for enchantment of the current product.
According to their road-map, the final release of the exchange was expected on May 2018. They were unable to follow the road-map since inception to till now. With approximately 9 months over, the hype surrounding the project seems justifiably illegitimate.
Most surprisingly the same old beta version released in June 2018, is still being used by CGCX Exchange
Even before starting ICO, they managed to go public now it is 9 months over after raising money and still the team is using the same old release.Feature updates and maintenance is the only activity that happened across the exchange. The only thing that got changed is the market and volume of tokens, everything else remain same.
Even after doing multiple phases of crowd sale and getting funded a hell lot, the team was unable to get the exchange updated. The interface of this exchange is familiar with crypto nerds, most probably a white label exchange which CGCX got purchased earlier, because of that only they were able go live before ICO. The probability of having a dedicated team working on a native exchange can’t be eliminated, but still if they got a dedicated team then regular release and updates will be there also ate-least any of them will have some social mediums.
Incoming Buzz words >)
Cross Platform Trading
For those who are unaware of Cross platform trading, It is the world’s fastest charts based on HTML 5 which will cover all of our thousands of markets with unique responsiveness across all platforms, browsers and screen sizes. Users have the ability to trade and create orders direct from the chart itself having multiple chart styles, overlays and indicators with alerts on prices, trend-lines and technical studies. Trading charts are embedded in the web-based dealing platform. Simply click the chart icon next to any market to pull a new chart into the chart window. You get outstanding performance from our charts whichever platform you use. Charts load and update swiftly, and you can scroll and zoom effortlessly, giving you maximum control. If you look into CGCX exchange, they uses a third-party chart, forget about cross platform trading and getting hybrid, Charts are necessary part for the exchange for communication.
Wallet
If it is about wallet for CGCX token, currently there is no activity happening around wallet or even for the token to swap or on the exchange part. When we see a lot of hype words in a single abstract, we should understand the category of these projects. May be they are talking about the exchange hot wallet and cold wallets. Currently there is no information available regarding the cold wallets and multi-signature system.
More Buzz >)
Multi-currency payment gateway, wtf every payment gateway supports multiple currencies
Decentralized, what? CGCX token or exchange or peoples?
Secure storage? Storing what, tokens?
Blockchain-based-system wow filled the space.
Fraud and scams, if caught CGCX get sued.
Insured, on what? CGCX token?
Multi-Factor Authentication
There are no security options currently implemented other than 2FA. For login basic password authentication is only used. There is currently no feature available for flagging IP address, there is no Captcha presents, mobile authentications or notifications is not available, no email authentication. All you need is create an account, verify the mail address. Add assets to the exchange and start trading. Email notification is provided, current release comes up with basic single password authentication and google 2FA.
KYC
KYC/AML was applicable only for ICO participants, because currently CGCX exchange do not mandates KYC/AML, there was no requirement for KYC/AML while using CGCX exchange either for purchasing Bitcoin or CGCX or any other available crypto-currencies or for trading.
Summary of Whitepaper
1. CGCX whitepaper is a filled with Hype words, which was the trend for most of scam ico. 2. CGCX whitepaper does not have any technical briefing of their exchange. 3. CGCX whitepaper is full of BS words, it can be better called as an Investment paper. 4. Realistically there is no hybrid crypto exchange running currently. 5. CGCX whitepaper is just an imagination of the founding teams, currently there do not exist an exchange with the proposed features. 6. The team is lying, cheating investors and scamming peoples round the clock. 7. CGCX whitepaper is just a thesis until and unless the suggested features are implemented.
Conclusion
These people launched an “ICO” by setting up a crowd sale for a token that has zero objective value at the time of launch, claiming to be hybrid exchange, smart contract platform and other BS stuffs while being ended up in a low level basic exchange which has been never upgraded since beta version.
CGCX conducted an “ICO” for a coin that has no other objective value than to ‘lower fees’ on a platform where they are already profiteering on.
You essentially paid CGCX for the privilege of paying CGCX a little less money than what you were already paying CGCX without any other clear, objective benefit to owning CGCX Token.
They suckered people into buying up $CGCX . There is no objective business model for $CGCX other than launching more gimmicky stuff (IEO ) in order to entice people to buy the coin.
This report can’t be completed without adding chain analysis and other forensic analysis to get in deep to this shit scam which will updated regularly until and unless CGCX people stops shitting to users.
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