Telegram became a power house social messenger platform during the crypto boom of 2017 but also attracted the worst of scammers.
As the title states, this article will talk about how Telegram became the power house social messenger platform that it is today during the crypto boom of 2017 and bust of 2018 but also attracted the worst of scammers. Let’s start off with the basics, what is Telegram? Basically, a cloud-based, instant messaging and Voice-over-IP service developed by Telegram Messenger LLP, a privately held company registered in London, UK and founded by Russian entrepreneur Pavel Durov. Telegram client apps are available for Android, iOS, Windows Phone, Windows NT, macOS and Linux.
Now let’s move on to the good, bad and ugly of this article. In 2017, at the start of the crypto boom or what others might call the major FOMO season that introduced smart contracts, Telegram provided teams of all kinds
the ability to play a huge role in advertising, marketing and shilling directly or indirectly to their projects’ user bases.
Telegram as a whole is an excellent and well-polished platform for peer-to-peer communication and offers a relatively simple way for organizations to create virtual communities. Make no mistake, it is not in any way the problem that exists today, but is rather a synergistic catalyst wherein fraudulent crypto projects can launch and excel. The focus here is to communicate how it was used and still is used by dishonest projects to maliciously steal from and lie to their unfortunately dedicated followers, believers and investors. The following are a few major examples of this dire reality.
Let’s start with BitConnect, one of those names that people actually took seriously back in early 2017.
While the exchange presented customers with an array of lending services that resembled Ponzi Schemes, many people continued to back the project and invest in its offerings. However, after a year or so, it became undoubtedly apparent that the ridiculous interest rates the company was offering were just not sustainable and within a year’s time, the company had to shut down after they were issued with a host of cease and desist orders. The lawsuit cited no less than 22 different legal violations, as well as provided an exhaustive overview of what BitConnect was and outlined its history. BitConnect shut down its crypto-lending platform in January following the issuance of these orders from Texas and North Carolina securities regulators, which claimed the company was engaging in an unregistered securities sale through its initial coin offering. BitConnect’s BCC token tanked as a result, falling from more than $400 to less than $20 in the first weeks of 2018.
The sudden loss of value led to multiple lawsuits seeking restitution for investors who saw their holdings evaporate, citing fraud and non-compliance with securities sale laws. It named BitcConnect Public Limited, BitConnect International PLC, BitConnect Ltd, BitConnect Trading Ltd, as well as nearly 40 individuals affiliated with the project, including BitConnect India head Divyesh Darji and promoter Trevon James.
Included in the list of defendants in the most recent amended consolidated class action is YouTube, which was sued in July for allowing BitConnect promoters to publish more than 70,000 hours of content. The consolidated lawsuit called for a jury trial and seeked rescission of the investments made by the plaintiffs. It also looked for compensatory damages for the plaintiffs. Silver concluded that “the ideal outcome is that all of the money is returned to the investors in BitConnect.”
And in the end, remember that the BitConnect token had been featured among the world’s top 20 most successful tokens. By simply using the Telegram platform, the project’s core members and its community Admins were provided with a very influential yet simple way to shill, market and advertise to their investors causing a huge snowball effect that made this project’s token price rise to unbelievable values.
Next up, Confido. It held its ICO November 2017 and was able to raise more than $350,000 USD. The company claimed to have developed a “smart contract”-based platform that would be able to streamline business operations for startups looking to incorporate blockchain into their existing structural framework. Confido’s native currency began trading at an impressive level of $1.20 per token but within a couple of months, it became obvious that the entire operation was a big ploy to steal money. Soon after it was found that the project was ridden with loopholes, the main people involved with the project disappeared almost overnight including all of their social media accounts and websites.
Karbon is another one of those projects that looked extremely legitimate when they took off but a couple of months in, it became clear that the creators were only in the market to make a quick buck. The platform promoted itself as being a decentralized social marketplace and was able to raise more than $200,000 during its ICO period. Per its whitepaper, the Ethereum-based project said that it would help facilitate communication channels between users, merchants and advertisers so as to create a trade market that was not only professional but also decentralized.
Last but certainly not least, Plexcoin. This project launched its ICO last year and was able to acquire an impressive sum of $15 Million. However, shortly after Plexcoin was scheduled to go live with its platform, the company’s assets were frozen and founder Dominic Lacroix was charged after being accused of defrauding investors by making false claims and promises than could not be delivered upon.
Now these are just a few projects that scammed people of money, but without a doubt there were hundreds of fraudulent projects that were using Telegram on a daily basis to gain the trust of unsuspecting investors, newbies and even seasoned veterans. There needs to be a way for Telegram to flex its muscles and restrict these types of projects from opening an account on its platform or at least terminate those that are currently active. In the end, some kind of protocol should be put in place to prevent this type of shameless and destructive behavior.
Without these measures or something to their degree in place, these make-believe projects will continue to put up a facade, fraudulently operate and steal money from potential investors without any real working product in the end. Of course, these illegitimate projects do have other outlets and sources to reach the public such as Twitter, Instagram and the use of CMC advertisements that can be used to target any audience looking to invest in seemingly interesting projects, but Telegram needs to understand that their huge social platform is used in many countries around the world and is arguably the go-to for shilling potential projects which could lead to massive rises in price for the back-end team to capitalize. These teams and their associated Admins in the communities cause FOMO and promise products/ services that in reality won’t ever exist.
And let us not forget the heavily-invested players who HODL in these outwardly promising projects that crucify anyone who shames the project or calls FUD on anyone making any statement against their teams. This is in no way the answer or holy grail to stop fake projects from launching and operating, but it is definitely a start as Telegram is a huge social outlet which can be used to maximize the amount of fiat and/ or ETH/ BTC that these projects can potentially receive in funds.
In conclusion, the good – Telegram will always be a major player for crypto projects regardless of legitimacy of these teams. They hold a huge key which favors investors due to the ease of use and instant communications with all the players in the cryptosphere. The bad – they need to ramp up security measures that can restrict new and old, evil-intentioned projects from conducting such operations on their platform; the use of proper protocols could very well cut down huge profits that these illegitimate projects may earn. The ugly – our crypto space has already lost a large magnitude of money due to these scams. This has severely hurt the crypto space causing many to leave and conclude that crypto is not ready for mass adoption. This in a sense is true, but it does not mean that it’s the end. On the contrary, it’s actually still much the beginning. With proper research and rules of conduct, those who are cognizant of such malicious projects will have the upper hand without the risk of losing their hard-earned investments. Blockchain technology and Cryptocurrency as a whole will thrive for future generations. #WeAreBlockchain “Forever”
What do you think Telegram could do about these scammers and fraudsters?
From: https://globalcryptonews.io/telegram-the-good-the-bad-and-the-ugly/
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