Vegetables on a Blockchain ICO Exit Scams After Paying People to Write On Their Bodies

The current cryptocurrency investments ecosystem is one of the purest forms of a free market in economic history. This gives rise to an incredible growth which makes some people overnight fortunes and allows startups to flourish like never before. Unfortunately, it also puts the burden on investors to vet the teams, ideas, and capabilities before getting involved with any ICO.

Exit Stage Right

The website for an ICO project called Prodeum has gone offline unannounced on Sunday, leaving only a nasty message to investors behind. Unlike in similar cases in the past, this time there was no attempt to claim the system was hacked, or pretend it is part of temporary maintenance and will be back in business shortly. The social media accounts of the project were just deleted, and it was as if it never existed to begin with. Investors were left to complain on social media with many calling it a premeditated exit scam.

According to its press release, Prodeum was supposedly a startup from Lithuania, which was “about to revolutionize the fruit and vegetable industry with the use of Ethereum blockchain technology.” It claimed to have already had discussions with the International Federation for Produce Standards (IFPS), and officially launched a crowdsale on January 20th. Plans were underway to begin trial runs in Lithuania and the U.S.

“It’s an idea whose time has come,” said at the time Prodeum product manager Rokas Vedluga. “We’re proud and excited to bring this remarkable new technology to the world!”

Lost of Red Flags, $5 Each

Considering that ICO teams can’t really be compelled to deliver everything they promise anyway, the temptation to pull an exit scam at such an early stage isn’t that great. However, it now seems that the people behind the project used fraudulent means to promote it from the start. Investors have found out that the images of “fans” the Prodeum team claimed on social media, were actually those of paid freelancers from the task marketplace Fiverr.

This isn’t the first time the site has been involved with shady ICOs. In fact, Fiverr is a known hotbed for cheap crowdfunding where you can even find people offering white papers for as little as $80.

The Neo platform was designed to serve as a launchpad for Initial Coin Offerings. Since hosting the Red Pulse ICO last year, Neo has accommodated around a dozen ICOs, with another dozen in the works. From a fundraising perspective, these crowdsales have been successful, selling out rapidly and raising hundreds of millions of dollars. But from a technical perspective, several of Neo’s largest ICOs have been blighted by problems.

             Apex Gets Owned

In the last 24 hours, Apex has become the latest Neo crowdsale to suffer a major incident after a hacker replaced the website’s contribution address for its own. The feat resulted in 1,056 neo going to the attacker’s wallet. Explaining the incident in its Telegram channel, Apex wrote:

A short while after the start of our crowd sale, malicious actors were able to take control over our website and change the correct ICO address…We decided to immediately take down our website and go for an alternative route, i.e. post the correct address via our social media (Telegram & Twitter). We also posted a selfie of our CEO showing the correct address timestamped on a piece of paper.

It concluded: “We will make sure that users that have contributed NEO to the wrong address will receive their rightful amount of CPX. Only payments made to the specific address in the website will be honoured.” Apex is the not the first Neo ICO to encounter issues this month; The Key was also bedeviled with problems. As news.Bitcoin.com explained: “First the token price was jacked up 300% shortly before the sale started. Then the site crashed, and then the Telegram group was flooded with spam links, porn and thousands of complaints as the event degenerated into total chaos”.

     Neo ICOs Aren’t Going That Well

Neither of the Neo crowdsales that have encountered problems this month are the fault of the team behind the Chinese blockchain. It’s vital though for any smart contract platform to get off to a good start, as the failure or hijacking of early projects can sap confidence in the fledgling ecosystem. For all its success, Ethereum is still haunted by the spectre of the DAO hack which saw $50m of ether stolen from its first major token sale in year one.

Neo ICOs Aren’t Going Well
Seemingly every week, news emerges of Ethereum ICOs that have been hacked or exit scammed; in the last few days Experty had $150,000 stolen in the same manner as Apex, and Prodeum and Benebit both exit scammed. The weight of legitimate Ethereum projects far outweighs the dubious ones, however, and thus confidence in the platform remains. Neo conducts far fewer crowdsales and the projects that have launched to date have yet to prove their worth. In the light of ICO hacks and technical failures, pressure is now on early Neo projects to prove that they can add real value.