Blockchain Startups Accused of Conning Investors $8 Million with Exit Scams

By Anne W. | May 19, 2019
Blockchain Startups Accused of Conning Investors $8 Million with Exit Scams

On May 16th, RepuX and JoyToken – 2 blockchain-based tech startups – have been accused of performing initial coin offering (ICO) exit scams to con investors.

Specifically, the 2 blockchain startups have showcased a number of falsified ICO advertisement, and have successfully stolen $4.7 million and $3.3 million respectively from investors.

“RepuX claimed that it was trying to build what it called a ‘blockchain-powered data marketplace,’ while JoyToken was trying to create a decentralized gambling platform, powered by its own JOY token.” TNW remarked regarding the Blockchain firms’ plan of action.

Business at the UK branches of the 2 companies has been reportedly shut down this week. The websites and Telegram channels affiliated with the 2 firms have stopped reporting news related to RepuX and JOY Token. Their official Twitter accounts have also gone offline since the news broke.

RepuX and JOY Token have been having a good business relationship, as Andrew MacDonald – JOY Token CEO – took to Twitter to confirm considering RepuX as its “sister company” sometime around early 2018. The ICO database ICObench further revealed that the 2 companies hired the same professionals –  to provide expertise for their projects.

RepuX and JOY Token also worked with AmaZix – a marketing solutions website – to provide management for the communities of both organizations. However, the 2 tech firms failed to pay the fee previously agreed by all parties.

“The ICO teams have stated that because of the lower than expected results in their token sales they are no longer willing to pay out the originally allocated amount to the bounty participants.” AmaZix posted on their website regarding the incident.

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