Class Action Suit Against Stox
For many people, the idea of cryptocurrency meant financial freedom. To some, it was a step in the right direction - away from centralized money and government-controlled bonds subject to freezing and inflation at the whim of Big Brother.
While cryptocurrency has many wonderful incentives, it also presented an opportunity for malicious people with the technical know-how to bamboozle investors out of their money.
We've seen many instances of copycat tokens, ponzi schemes, deadcoins and the unaffectionately named shitcoins that have plagued the already infamous reputation of crypto.
Following a series of negative trends, the Stox project now finds itself at the receiving end of a class action lawsuit.
Stox (STX) is a cryptocurrency token that operates on the Ethereum platform. The Stox team presented their project as a "next-generation market prediction platform". They promised an advanced AI model that would one day be able to predict results of events such as sports by taking into account the input from users(Machine Learning).
However, after over two years following their ICO, they have little to nothing to show in terms of progress. The Stox ICO was held on August 2017 and grossed over $34m USD in less than 48hours with thanks no doubt to a celebrity promotion by boxing superstar Floyd Mayweather.
Stox activity went up amidst the hype and at its peak (Aug 25, 2017) its traded at $2.74 in exchanges. source
It has been downhill ever since. The Stox Markets App – though exciting at first, quickly became boring and eventually devoid of activity.
Stox had promised investors that they could win tokens by staking in predictions but later reneged on that feature and decided to pay "only the top predictors".
This did not sit well with many investors and soon the Stox price started dropping. Today it sits at an abysmal $0.0148 source
The funds raised from the ICO have yet to be accounted for and the project has now been labeled as an exit scam.
The founder of Stox, Moshe Hogeg, has also been accused of using the funds to finance another dubious blockchain venture (SIRIN LABS).
If you have been affected financially by this development, you can join the class action lawsuit against Stox here
So what do you guys think, will IEOs be any different?
Should Ethereum be regulated to stop the proliferation of these kind of scams?
What other measures can be taken?
In regards to this comment:
Any kind of crypto that offers profits is subject to unannounced regulation by most governments. Meaning, just because it's decentralized does not mean that the intentions of the user can't be regulated by using something.
In simple terms, if you think that by using any crypto you will never be accountable for regulation, you are just closing your eyes. Especially to everything that promises profits.
@ulqu3, Yes, Cryptocurrency brought lot of changes to people's lives but at the same time there were and are who wants to play with the loop holes. It's important to do deep research and to follow our Intuition instead of following the rushing excitement in this space.
Posted using Partiko Android
Hello @chireerocks. You are correct about doing research but what about those new to crypto who have no idea what makes a project viable?
Yes that's the point. If someone is new then they have to do initial research about this Ecosystem and how it works.
Posted using Partiko Android
Hello @ulqu3, interesting article.
I think that in the ICO boom, many people hurriedly invested in projects based on good propaganda, because of the BTC's success, many came to think of quick profits and ended up being scammed, now I think investors are being more cautious but logically this damages even more the reputation of blockchain.
Now, I think that there must be sanctions and also regulations that guarantee the security of the investor.
@fucho80
Hi, thanks for your input. What kind of sanctions do you think would suffice and how do you propose they are enforced?
Hi @ulqu3
I'm afraid that using bidbots right now will always get you in trouble. Just the way you become downvotes (without any warning) by current few flaggers.
"I think we should build blockchain" -> I lauged so badly once I've seen that sentence hehehehe :) good one
To answer your questions:
I strongly believe that tokenizing ownership would solve most problems. In case of Stox - investors didn't have anything that could back up value of purchased token. So perhaps STOs would be solution? That's what I like to think :)
ps.
from what I remember,Floyd Mayweather had to pay some fine for promoting this ICO (or was it different one?) and was forbidden to promote any ICO in the future.
Enjoy your weekend buddy, upvote on the way.
Piotr
It's pretty ridiculous man. People who own bots flagging posts of those who use other bots and claiming they are helping steem smh.
Tokenisation could work. But the stakes are high. Imagine losing the digital keys to your house haha
Yeah Mayweather promoted ICOs run by Centra Tech. They include Stox and Sirin Labs
Hi @ulqu3
I absolutely agree with you :/
ps. remember to check @project.hope sometimes (or visit our telegram channel) and try to support other authors from our group with some valuable comments. Become part of our small community :)
Stopped in for the Dilbert but have to say that IEOs sure seem like sheep in wolves clothing.. Wolves hunt, sheep follow. Large corporations follow brilliant innovators then use their numbers or power to control the successful ventures. If IEOs are overly influenced by an exchange, seems like an easy way to pass the blame and take the credit when desired.
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