Cryptocurrency has become highly popular recently where so many bogus companies have been riding the trend on crypto trading to scam people. It is not surprising to find some riding the waves of its popularity and try scamming people by misrepresenting itself as associated to legitimate trading companies.
One of the current scams in the crypto industry involves Virtcoin which is now facing a legal ramification for engaging its business in crypto trading. Many have been wondering is Virtcoin a scam and there are things you need to know just in case you are being offered to make an investment in it.
Virtcoin introduced itself in the cryptocurrency industry offering some form of a crypto investment business where it represents being backed up by Virtu Financial, Inc., a popular electronic trading firm that is famed for losing rarely since it opened in the market in 2009 till 2014. It announced in the public that it is opening its own digital currency and promises to send large amount of Bitcoin and Ether in exchange of investments from the public.
What is Virtcoin?
Virtcoin represents its business to be engaged in Initial Coin Offering (ICO) and targeting large firms to make investments on its digital coins. Virtcoin is currently on the red flag in the cryptocurrency industry for being a scam. Recently, Virtu Financial, Inc. announced that the digital currency that Virtcoin issued is a fake. It denies its involvement in the business of Virtcoin and in fact announced that it is taking legal actions against the company. Many people were enticed to invest in Virtcoin considering that they believe Virtu Financial is behind its business and it is known for being a legitimate cryptocurrency high speed trader.
When Virtcoin issued a press release that it is going to issue a digital currency called the VIRT token for trading by impersonating Douglas Cifu, Virtu Financial Inc. Finance Executive, this called a massive attention from the public as Virtu Financial announced its denial of any connection or affiliation to Virtcoin and it will defend itself from any attempt of Virtcoin to infringe on its copyright, intellectual property and trademarks.
How is Virtcoin a scam?
Virtu financial uses VIRT as its stock symbol. Virtcoin is riding over the popularity of Virtu Financial for being a fast trader with less known losses in crypto trading. Virtcoin uses VIRT as its currency token for investors for its business and knowing that tokenization is something common in Initial Coin Offering trading platforms many investors fall for such proposition. Many startup companies have been using ICO in order to bypass regulations for trading ventures and through cryptocurrency unregulated trading becomes possible.
These startup firms will use cryptocurrency to raise money for ICO and prepares a white paper that represents an overview about the project and explaining how the venture is undertaken and the amount of the virtual tokens as among many others. The cryptocurrency is usually sold to backers for the project in exchange of Bitcoin as cryptocurrency or for legal tender.
It has been discovered that Virtcoin has been using fake accounts to associate its venture to large firms in order to make their investment offer to the public look legitimate. When people start investing the money they invest in the form of Ether or Bitcoin will give them access to VIRT coin. However, since the VIRT coin as the currency traded by Virtcoin does not really exists the amount invested by investors easily disappears and cannot be recovered.
Virtcoin has been using social media as well to entice people to make a cryptocurrency investment. There are also some dubious concerns regarding its white paper where it claims that an encrypted digital currency is based on a block chain system and that it is urging everyone to make an immediate investment. It definitely underestimates the risks involved in ICO investing and obviously simply wants to get people to invest.
My Final Opinion of Virtcoin
Is Virtcoin a scam? I am more inclined to say that it is. It is more involved in Initial Coin Offering (ICO) scam where it is enticing the public, mostly large investment firms, to trade with legitimate cryptocurrency like Ether and Bitcoin in exchange of its alleged legitimate VIRT coin. Considering that it is using fake profiles and even use large trading companies like the Virtu Financial, Inc. in order to advertise its cryptocurrency trading venture how it does its business is quite illegal and technically considered to be designed in order to scam investors.
If you are enticed to venture into cryptocurrency trading you should be smart in checking out the background and company profile of the trading company. Crypto trading has no genuine guarantee that it can yield profitable investment and together with ICO there are no regulations as yet that will ensure that investors are protected from scammers.