Investors in a South Korean ICO have apparently been scammed out of a total of 13,500 ETH, worth around $2.8 million. The money was raised by selling the native token of PureBit, an online crypto exchange that has subsequently disappeared.
According to Bitcoin Magazine, the scammers pitched a new crypto that was to be the BNB-like native token of a new exchange, and would give investors shares of the exchange’s trading revenue as well as discounted fees for trading. The PureBit trading platform was due to be launched at the end of November.
The exchange subsequently removed all its online presence. The invested funds were also withdrawn from an ETH wallet out into fiat currency, in two large transactions. The company's official Kakao social media group also kicked out all members, and an apparently overly formal "I'm sorry" message was all that users who had been conned were left with.
The founder’s Kakao account caption just says, “I’m sorry.” And it’s written in high formality.— Korean Cryptocurrency & Blockchain News (@BlockchainROK) November 9, 2018
Brutal! I wonder if that’s sarcasm or if he actually #feelsbad 🤔#exitscam #yogibearmarket (Yogi 요기 in Korean means “over here/it’s here”.) pic.twitter.com/Y3J6oPvdRc
South Korea has officially banned ICOs from operating in the country, due to the high risk of fraudulent activity such as this. Leading Korean exchange Bithumb is making plans to relocate its operations to a more crypto-friendly regulatory environment, although the popularity of crypto in the nation could well lead to the ICO ban being reversed and controls on crypto trading being loosened.