In what is turning into a real cautionary tale for the cryptocurrency community about the need to be wary of celebrity’s power, along with skepticism about most initial coin offerings (ICOs), the US Securities and Exchange Commission (SEC) announced an ICO endorsed by champion boxer Floyd Mayweather has officially been deemed a fraud.
Also read:
The Cautionary Tale of Floyd Mayweather’s Entrance into the ICO Scene
SEC Halts Fraudulent Scheme Involving Unregistered ICO is the unambiguous title of an SEC press release issued 2 April 2018. “The Securities and Exchange Commission today charged two co-founders of a purported financial services start-up with orchestrating a fraudulent initial coin offering (ICO) that raised more than $32 million from thousands of investors last year. Criminal authorities separately charged and arrested both defendants,” the notice begins.
Centra Tech Inc. co-founders Robert Farkas and Sohrah ‘Sam’ Sharma are alleged to have “masterminded a fraudulent ICO in which Centra offered and sold unregistered investments through a CTR Token. Sharma and Farkas allegedly claimed that funds raised in the ICO would help build a suite of financial products. They claimed, for example, to offer a debit card backed by Visa and Mastercard that would allow users to instantly convert hard-to-spend cryptocurrencies into U.S. dollars or other legal tender,” the SEC complaint outlines.
Indeed, according to an expansive New York Times profile of the pair and Mr. Mayweather last year by Nathaniel Popper, “How Floyd Mayweather Helped Two Young Guys From Miami Get Rich,” 27 October 2017, “The debit card was described as a new product that would make it possible to spend virtual currencies anywhere Visa cards were taken. The company’s site showed Centra cards emblazoned with the Visa logo,” Mr. Popper exposed. “There was one problem with this plan. The company had not been approved, or had even applied, to run a Centra card on the Visa network, a spokeswoman for Visa said. After The New York Times reached out to Visa this month, Centra took all the mentions of Visa off its website.”
The SEC , “In reality, … Centra had no relationships with Visa or Mastercard. The SEC also alleges that to promote the ICO, Sharma and Farkas created fictional executives with impressive biographies, posted false or misleading marketing materials to Centra’s website, and paid celebrities to tout the ICO on social media.”
Buyer Beware
Mr. Popper noticed, “The primary business experience of Mr. Sharma and Mr. Farkas was at Miami Exotics, a luxury car rental business that the two built.” In September of last year, Mr. Mayweather “told his 13.5 million followers on Facebook not once but twice that they should buy a new virtual currency known as the Centra token. ‘Get yours before they sell out,’ he wrote above a picture of himself admiring the many boxing title belts he had been awarded over the years. ‘I got mine and as usual I’m going to win big with this one!’”
Mr. Mayweather has also endorsed at least two other coins, Hubiits and Stox, at times referring to himself as ‘Crypto Mayweather,’ a twist on his ring name, ‘Money Mayweather.’ Mr. Popper continues, “A basic background check would have turned up the numerous run-ins with the law that Mr. Sharma, the company president, has had. Mr. Sharma has been sued in Florida and New York several times on allegations of unpaid bills and business deals gone sour. Twice, people have accused him in court of trying to fraudulently sell or lend them cars that he didn’t own, and twice he has been evicted for claims that he failed to pay rent.”
Mr. Sharma and Mr. Farkas
As The New York Times piece was being put together, Mr. Sharma was indicted for perjury shortly after Centra finished a fundraising round. In 2016, Mr. Sharma was arrested for suspicion of drunk driving his white Maserati. Mr. Popper ominously foreshadows Mr. Sharma as saying, “I’m obviously not comfortable with that situation. But it’s not that I did something so intensely crazy that investors need to worry.”
The SEC’s Stephanie Avakian outlines the complaint, “We allege that Centra sold investors on the promise of new digital technologies by using a sophisticated marketing campaign to spin a web of lies about their supposed partnerships with legitimate businesses. As the complaint alleges, these and other claims were simply false.” Mr. Sharma and Mr. Farkas were charged with breaking federal securities laws governing anti-fraud and registration. “The complaint seeks permanent injunctions, return of allegedly ill-gotten gains plus interest and penalties, as well as bars against Sharma and Farkas serving as public company officers or directors and from participating in any offering of digital or other securities. In a parallel action, the U.S. Attorney’s Office for the Southern District of New York today announced criminal charges against Sharma and Farkas.”
Would you invest in a celebrity-backed ICO? Let us know in the comments below.
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James Wagner, Extensions Platform Product Manager of Google, took to the behemoth’s Chromium Blog on Monday in a post titled, Protecting Users from Extension Cryptojacking. “Starting today,” Mr. Wagner explained, “Chrome Web Store will no longer accept extensions that mine cryptocurrency. Existing extensions that mine cryptocurrency will be delisted from the Chrome Web Store in late June. Extensions with blockchain-related purposes other than mining will continue to be permitted in the Web Store.”
Also read:
Google Moves Against Cryptojacking
“Over the past few months,” Mr. Wagner began, “there has been a rise in malicious extensions that appear to provide useful functionality on the surface, while embedding hidden cryptocurrency mining scripts that run in the background without the user’s consent. These mining scripts often consume significant CPU resources, and can severely impact system performance and power consumption.”
The chart above shows a recent example of CPU overutilization from hidden coin mining in an extension.
Cryptojacking has shown up in various places, from Pirate Bay to Salon, and as a phenomenon is only a few months old. Heck, even Elon Musk’s have been “infiltrated,” as “Tesla’s Kubernetes console (a system for containerized apps that was originally designed by Google) which was not password protected” was hit by cryptojacking. As these pages just a short while ago, “the extent of the problem has been vastly overstated. Smart criminals aren’t covertly crypto mining in-browser, not because they’re incapable of doing so, but because even at scale it simply isn’t profitable.”
90% Non-Compliance
James Wagner
True as that might be, it evidently has become an annoyance for enough users that Google has taken notice. “Until now, Chrome Web Store policy has permitted cryptocurrency mining in extensions as long as it is the extension’s single purpose,” Mr. Wagner detailed, “and the user is adequately informed about the mining behavior. Unfortunately, approximately 90% of all extensions with mining scripts that developers have attempted to upload to Chrome Web Store have failed to comply with these policies, and have been either rejected or removed from the store.”
Of course it was only , the largest search engine on the planet announced formally it will restrict advertisement of “Cryptocurrencies and related content (including but not limited to initial coin offerings, cryptocurrency exchanges, cryptocurrency wallets, and cryptocurrency trading advice),” including aggregators and affiliates regarding “cryptocurrencies and related content.”
Mr. Wagner ends by reminding how the “extensions platform provides powerful capabilities that have enabled our developer community to build a vibrant catalog of extensions that help users get the most out of Chrome. Unfortunately, these same capabilities have attracted malicious software developers who attempt to abuse the platform at the expense of users. This policy is another step forward in ensuring that Chrome users can enjoy the benefits of extensions without exposing themselves to hidden risks.”
Have you ever been cryptojacked? Let us know in the comments!
Images via Pixabay, Google.
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Lavenir is the latest addition to the cryptocurrency world that is going to begin its ICO on April 4th and conclude on May 4th. It is all set to bring a new revolution into the market by digitizing the lending process.
Lavenir, the newly launched cryptocurrency lending platform is going to launch its ICO on April 4th, 2018, that will last until May 4th, 2018. The value of one Ethereum (ETH) is equal to 1000 Lavenir (LVR) and early investors will be able to receive a variety of bonuses through the ICO. The Lavenir platform will allow the individuals to deposit cryptocurrencies onto the site and lend them to the site for interest payments. It is created with an aim to provide a more sustainable approach over fraudulent cryptocurrency investment sites.
Lavenir is bringing a new revolution in the cryptocurrency trading by enabling the individuals to invest in professional crypto traders and receive the share of the profits made, based on a preset interest rate. Unlike several other investment sites that accept only bitcoin, Lavenir accepts a variety of cryptocurrencies including bitcoin, Litecoin, Ethereum, Dash, Monero and Ripple. With the possibility of new cryptocurrencies being added in the future to match the needs of investors. The platform is backed by a team of expert professionals with years of experience in crypto trading and other financial instruments such as stocks and bonds. Together, they strive to make cryptocurrency investment more profitable for the investors regardless of their level of engagement in the cryptomarket.
Lavenir is a unique platform that is created with an aim to provide long-term growth potential to the investors. It offers a variety of investment terms and rates that match the long-term vision of the platform as a stable, secure and reliable way of delivering returns on cryptocurrency investments to ultimately, provide a dependable source of income for the investors. The interest rates offered on this platform are also lower than some other lending platforms to accommodate this more sustainable business model. No unreasonably high interest rates are offered that would compromise the platform’s ability to pay investors.
Furthermore, unlike some of the other cryptocurrency lending platforms whose interest rates may fluctuate after the investment is made due to complicated formulas in calculating returns, Lavenir locks in the interest rates at the time the investment is made so that they don’t change. Also, the LVR interest payouts are guaranteed on a day to day basis, to make it preferred by the investors further.
In the regularly fluctuating cryptocurrency market, Lavenir has adapted its investment strategies to balance out the high profit and low-profit days so that investors can achieve benefits long-term.
More information about Lavenir and the ICO can be found at
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drmlenac@gmail.com
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Ripple News Update
In the last 24 hours, Ripple prices gained four percent while the cryptocurrency market cap added $15.2 billion, demonstrating that investors are feeling particularly generous this Easter Monday.
However, the broad trends are still active.
One day’s reprieve does not change the fact that cryptocurrencies are backsliding. Investors are simply terrified of potential regulation, and that fear becomes self-fulfilling—it eventually leads to an avalanche of sell orders.
What I find interesting is that companies react the exact opposite way to potential regulation.
Sure, business owners and Wall Street-types will spout abuse at government ineptitude,.
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