BlockBroker, the ICO aiming at eradicating ICO scams, turned out to be a scam itself. The team went in hiding, wiping out the site and all communication channels, as it is usual with similar ICOs. The Blockbroker.me website has a message that it is down for maintenance. Only a few hours ago, the ICO was still being promoted on Twitter. But just then, users realized something was off.
Ironically they did an ICO to protect against ICO scams.
— DONNY BITCOIN (@DONNYBITCOIN) June 6, 2018
The fallout for BlockBroker started after a telegram user called attention to the fact that the team may be performing fraud, with useless ERC-20 tokens. The user was banned, and the project was eradicated soon afterwards. There were indications that the team actually sent their tokens to EtherDelta, the decentralized exchange, even before the token sale ended. Because the ICO was running until July 20, according to plans, the team may also have intended to send their share of tokens quickly.
But there are indications that BlockBroker was a known scams months ago – an airdrop site’s comment section reveals that the project may be a scam. However, the free tokens, listed as BBK, not BKBK, are deemed safe enough by ICOcreed.
What is curious, is that the BKBK digital asset and the projects were given a 5.0 grade by the TrackICO service. Apparently, the site did not notice that the founder of BlockBroker, one “John Jacobs”, had used a stolen picture for his profile, thus obscuring his true identity. Along with a vague white paper, the ICO could not survive until its end date on July 20.
The aim of BlockBroker was ambitious:
“In a world where a new ICO is popping up every second day, fraud has become a major issue. Research shows that 10% of ICO’s are fraudulent, however this number is rising. Block Broker has set out to provide a 100% safe environment for ICO investors. We are creating Block Broker – the first decentralized ICO broker service to completely eliminate ICO fraud. When an investor contributes funds to an ICO on the Block Broker platform they will be 100% confident that the funds are secure via the BBK token smart contract escrow system.”
ICO exit scams are nothing new – the last one was for Centra (CTR), which even traded for months before the team attempted to disappear physically. Previously, Confido (CFD) pulled a similar scam soon after the ICO ended.
Experts have shared that the crypto sector needs more experts, oversight and the generation of trust, and the case of BlockBroker, which received excellent marks across the board, further stresses that need. BlockBroker was one more case where disinformation led to losses.