Russian Crypto Exchange, Yobit Uses Ticker Name to Fraud Traders
In a recent post written by cryptocurrency and blockchain researcher, Richard Di Britannia, it has been unveiled that Russian crypto exchange that goes by the name, ‘Yobit’ has been scamming investors into thinking that they had invested in legitimate tokens, but really only throwing money into the dumpster.
The tactic used thus far is the simplest one could imagine, and that entails trickery using the supposed token’s ticker name. Several examples have since been provided and they go as follows: investors who think they’ve purchased OmiseGO (OMG), ended up with OMGame (OMG). The same can be seen for those interested in the Binance coin (BNB), where Yobit created their own garbage token dubbed Boasts n’Boobs (BNB).
The Russian-owned #cryptocurrency trading exchange 'YoBit' has been faking tickers to commit consumer #fraud over the last 3+ years:https://t.co/pF2NEusuuE#Crypto #Cryptonews #Bitcoin #Ethereum #Scam #YoBit #OMG #PHR
— Richard Di Britannia (@RDBritannia) October 15, 2018
Here is a breakdown as to how the scam takes place:
- First, they claim to list a coin under the ticket, OMG, which investors would assume as being OmiseGO
- In that gap, the team will “create and release a scam-coin”, OMGame
- OMGame gets listed under the OMG ticker, which is listed at a significantly reduced price
- The team uses a technique called “wash-trading,” which supposedly keeps the volume high
- When investors realize it is a scam, Yobit removes it
- Finally, e-mails go out indicating that the said token no longer meets the requirements of both the exchange and its T&C
The ongoing scam, according to Di Britannia, has been strong and steady for three years now, with no indication of it stopping. Not only has the team broken trust in crypto exchanges, they have used promotions to lure in more investors. As per the claims made, investors were offered free alt-coin listings as well, with cheap alternatives present for those willing to wait a couple of days.
This is a strong example of why fair regulatory frameworks are needed in place. Given that the crypto sphere boasts highly of its trustworthy, honesty and security to name a few, two of the three aforementioned have been disregarded in the case of Yobit and it only shows the extent to which scams can take place. As per Di Britannia’s quote:
“Many traders are more than likely to fall victim to Ponzi-schemes, fake technologies or vanishing ICO’s […] Should consumers continue to use fraudulent services such as ‘Yobit’, the cryptocurrency sector will continue to suffer detrimental setbacks.”
What are your thoughts on Yobit? Are you surprised at how a simple tactic helped the Russian team prey on investors’ money? Let us know in the comments below.