Confido was launched a while back as a “trustless escrow payment” solution that uses smart contracts. And boy it was “trustless” indeed. As of November 21st, there’s no word from the Confido team. Their website was pulled down, all social accounts were closed, and there’s even doubt that the Confido CEO, Joost van Doorn, is a real person – CNBC found out that he lied about having worked for eBay, PepsiCo and Zalando.
The last official post by Confido was a worrying Medium post mentioning legal troubles. They mentioned that they are having legal trouble because of a contract they signed with assurange from their legal advisor. No other details, except that development has been halted:
While this scared Confido investors, the final blow was terminating the site, social accounts and cutting all communications. Confido raised $375,000 in their ICO, and those money are lost for sure. The ICO was organized by TokenLot, and once it was successfully finalized they transferred the collected Ethereum to a Bittrex account. Bittrex uses Know-Your-Customer so there’s a tiny lead there, that TokenLot might find out who is actually behind Confido. They do need to involve FBI though, so that will take a while.
But the loss is much higher than $375,000. Confido ICO investors were given tokens in exchange for their investments. Those tokens could be exchanged and CoinMarketCap shows that the total cap of Confido was at one point $10,000,000. Right before the plunge, the market cap was down to $5 million, but still that’s an impressive amount. So you see, investors lost much more than $375,000, as no one knows how much of that trading CFD volume was owned by their founders. If they knew that Confido is a scam, most likely they traded it like crazy and are now resting in a sunny place.
A lot of ICOs are too good to be true, not to mention borderline scams. That’s why investors should be careful in choosing what ICO to invest in. Here are some lessons to be learned from the Confido ICO scam:
- KYC should be expanded to KYI (know your investment). Don’t just buy into any ico that posts a whitepaper and a video. There should be some sort of reputability behind the ICO you decide to invest in.
- Don’t invest in ICOs that have small soft caps. I invested in a few ICOs myself, but only after the owners passed several million $ in earned investments (i.e. Electroneum).
- Don’t invest much in a single ico. Instead try to diversify your investments.
- Look for ICOs backed by a public (verifiable) figure.
- The minimum you can do is check the whois of their main site (shouldn’t be anonymous), and try to find if the real people behind the ICO are actually real (i.e. Linkedin profiles).
That should be it. Feel sorry for those that lost money in the Confido ICO scam, but there are lessons to be learned here. Hope they catch those responsible and bring them to justice.