The largest crytocurrency exchange firm in South Korea, Upbit, has followed Binance’s lead in hunting down initial coin offerings (ICOs) that might be exit scams, Finance Magnates reported. Upbit is willing to hand out rewards to any individual willing to provide information on any ICO deemed fraudulent that might further dampen the already controversial nature of how tokens are used to raise funds online.
With ICOs becoming the quickest tool for unscrupulous individuals to launch their respective get-rich-quick schemes, the larger part of the community reaping the benefits of a coin trading software is alarmed with the way even established names got dragged into the mess. Having watchdogs among themselves prompted even firms like Upbit and Binance to eventually take on the cudgels to protect the investment environment cultivated based on trust.
Upbit noted how participating in the fight against fraudulent ICO hopes to “prevent damage” that said fund-raising endeavors cause to the legitimate ICO. This leads “to create a sound cryptocurrency ecosystem” in which individuals and enterprises with plans in investing in cryptocurrency would have less qualms about entrusting their hard-earned savings to tokens that will rake in the ROI in realistic terms.
No details were provided as to how can Upbit contribute in their own way. But the initiative is noted to last a year from now. Once March 2019 kicks in, Upbit will then reconsider extending said program based on the results from the year when said participation in crackdown occurred.
Hankook Media told Finance Magnates Upbit’s closest way of describing their game plan. “If illegal multi-level eyewitnesses or victims report to Upbit and investigating agencies at the same time, a cash award will be given to the first reporter of the illegal recruitment case.” The cash award was noted as amounting to about KRW1 million (US$940,000).
The way the word “recruitment” was used served as a sign that the act of soliciting referrals in exchange of affiliate commissions is still in practice. While the referring method was more reminiscent of the Bitconnect method of investing in cryptocurrency, certain ICO endeavors also used affiliate commissions as a carrot to entice more investors to jump into their respective crypto trading platform.