The Block’s Analyst Calls Out TenX as a Scam: Ten Months And No Product
According to an analyst, Singaporean blockchain payment platform TenX is a scam and is not fulfilling promises made to investors and backers.
Larry Cermak, the one levelling allegations, said he is “amazed there has not been a class action lawsuit yet”.
Reasoning of Cermak
According to Larry Cermak, his allegations are based on three major factors. First, he points out that the platform’s PAY token is just a shadow of its all time high (down 93%) with an overall drop of around 30% from its ICO values.
1/ I think it’s time to revisit TenX today. PAY token is now 93% from its all time high. People that bought during the ICO are now down ~30%. TenX is a company that never keeps the promises that it makes. pic.twitter.com/88Wm91WTMA
— Larry Cermak (@lawmaster) November 17, 2018
Secondly, he said that even after passing of 10 months, the platform still does not have a working service (TenX promises a crypto debit card to users).
Third, and the most serious, point Cermak raises is that the co-founder Dr. Julian Hosp has a history with a pyramid scheme company.
Is It True?
Before creating an all-out panic, let us look at the allegations and what is TenX doing about it. On the point about the PAY token, Dr. Julian responded by stating that since the PAY was paired with ETH during the ICO, the calculations should be done with it, not USD.
He said that during the ICO, 1 ETH was equivalent to 420 PAY. In today’s terms, he claimed PAY holders would get 1.09 ETH.
The payment card, according to the platform, had seen delays due to WaveCrest’s VISA service cancellation. The cards were being issued through WaveCrest. Dr. Julian had already announced in September that a new provider was selected and the new cards would be sent out to users shortly.
The third allegation stems from the executive editor of The Financial Telegram, Tamir Cohen Jr. He wrote that Dr. Julian had worked for Lyoness, a multi level marketing organization that had been investigated by different European countries, including Austria, Switzerland, Sweden, Poland, France, Hungary and Lithuania.
Even Australia has also looked into the practices of the company. Although there is not significant proof of Dr. Julian ever working for the company (his LinkedIn profile does not mention the company in his experience), Cermak claims to found a record of a workshop given by Hops.
The audio recording reveals Hops detailing a system of career levels that employees can advance by collecting points that are awarded on the basis of how many members they can sign up. He can be clearly heard saying,
“Income does not fall out of the sky, there is a predictable way of how to calculate and receive more income, and, if you follow this way, you can earn incomes in an extent that it’s not imaginable to you at this moment.” And, “Whenever you contact them, you only have one goal – and that goal is to get a meeting…tell them you want to go for a drink, tell them you want to go for a coffee…never mention Lyoness, never mention anything about saving money, the maximum you can say is ‘an opportunity to make money.”
Created by OneBit in 2015, the TenX platform had raised USD 83 million in the first seven minutes of its ICO launching.
According to Forbes, the company had paid its 80 strength employees around USD 6.7 million till now and still had USD 104 million.