Why did Bancor, which took $153 million, get worse and worse?
This article comes fromCoinDesk, original author: Leigh Cuen
Odaily Translator |
This article comes from
, original author: Leigh Cuen
Odaily Translator |
Legal issues raised by ICOs continue to affect the entire cryptocurrency industry.
According to data from CoinMarketCap, the Bancor BNT token, which sparked an industry boom two years ago, is now "appalling," with prices dropping from $4.49 in July 2017 to an all-time low of $0.44.
Of course, major investors in the Bancor project still hold these tokens, such as eToro CEO Yoni Assia. Yoni Assia believes that Bancor's $153 million ICO can almost be regarded as a "turning point" in the industry, and his insistence on holding BNT tokens is also out of trust in the team.
BNT tokens are used as the market-making reserve currency for all assets on the Bancor platform, providing fast liquidity for ERC-20 tokens on the network. According to the BNT token transaction records on Etherscan, there are usually about 100-250 transactions per week to trade tokens.
But the problem is that many assets traded on the Bancor platform have legal problems, and the company had to issue a new policy on July 8: Due to "increased regulatory uncertainty", US users are prohibited from accessing the Bancor platform. (The company declined to comment on the matter at this time.) An anonymous U.S. Bancor user said he was very disappointed not to be able to continue using his BNT tokens as the platform is now restricted in the U.S. market.
However, in addition to those niche products involving legal issues, traders have also tried to use the platform to seek arbitrage opportunities in digital assets such as Ethereum and EOS. Michael Safai from Dexterity Capital, a San Francisco fund, explains how to use Bancor for arbitrage:
"Lots of people" would place orders with both Bancor and EtherDelta -- an exchange that was sued in 2018 for trading unregistered securities -- and then those people would pull some of the less profitable orders, often such trades The amount is between $10,000 and $100,000.
Michael Safai says:
"It's like a baton game, someone will definitely bear the loss, some people pay more gas transaction fees just to attract more people to enter the game... In the end, there is only one winner who takes all."
"Bancor is very easy to convert tokens and protects my identity. Generally, I would choose to use Bancor for transactions because it allows unlimited use of my wallet or tokens."
An adviser to Bancor, who asked not to be named, claimed that while Bancor had done “pretty much everything they talked about” during the token sale, the team is still using the funds raised during previous token sales to do other things. various things. The consultant questioned:
"Is Bancor worthy of raising that much money? I don't think it's worth it."
secondary title
Bancor wants to build its own crypto empire
With no public disclosure, it's hard to be sure that Bancor used funds raised during previous token sales for various other things.
Bancor co-founders Galia Benartzi and Guy Benartzi now own stakes in several startups, including BlockchainIL, LiquidEOS and LiquidApps (which is running another token sale), according to documents disclosed by the Israeli Corporations Authority. ).
Galia Benartzi and Guy Benartzi and Eyal Hertzog, another co-founder of Bancor, are both shown as co-founders of LiquidApps, and among the company's eight co-founders, only two are not members of the Bancor founding team.
In addition, the non-profit organization Bancor Foundation has reached a cooperation with the Israeli non-profit entity LocalCoin Ltd to be jointly responsible for the platform development. BNT token holders, Tim Draper, a well-known venture capitalist in Silicon Valley, and the founding team of Bancor are listed as shareholders of the company. Tim Draper reveals:
"I think the Bancor founding team has been working hard to build a brand new economic system, and I hope Bancor tokens can cover all usage scenarios, from simple market tokens to personal tokens. In the future, every worker can own the token, Business owners have to buy BNT tokens to get employees to work for them.”
As it stands, Bancor has become a token ecosystem center that goes beyond the platform itself.
According to the information disclosed in Bancor's official blog, the platform has so far facilitated the creation of 148 tokens, taking Michael Fletcher, founder of British leasing company Chintai as an example, who used the Bancor platform to achieve his desired goal: to provide funding for niche projects fluidity. Users can directly use the Chintai token CHEX to pay for rental services, but the company can convert these tokens to EOS directly on the Bancor platform. Michael Fletcher explained:
“The biggest benefit of Bancor and BNT tokens is that you get a lot of liquidity, and once the price spikes, Bancor arbitrators will balance the tokens.”
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Legal Issues
It is undeniable that Bancor is indeed popular with crypto enthusiasts around the world and is a very useful tool, but the legal liability issue (if any) between the platform and traders seems to be murky at present.
Bancor, on the other hand, seems to place a lot of emphasis on liquidity without paying much attention to platform security.
In 2018, hackers stole $13.5 million worth of tokens from the Bancor platform, but the incident led to the discovery that Bancor had a built-in backdoor to help protect users in an emergency and raised questions about the team's legal liability.
Law firm Anderson Kill lawyer Stephen Palley believes that if an exchange or token issuer fails to disclose that assets may be destroyed or moved at will when selling tokens, it is suspected of violating state and federal consumer protection laws—although Americans can no longer use Bancor, but some US users said they bought BNT tokens during the 2017 ICO.
However, if you pay attention to Bancor's official website, you will find that it is mentioned above:
Bancor has the right to "stop" any "content" on its platform without any warning, which means they can delete, create or move tokens on the blockchain.
