You may remember last year we did a review of the WCX ICO, we then later on in the year published another article discussing the probability that this ICO could be nothing more than an elaborate scam – well, after many missed deadlines and little contact from the WCX team (who’s identities are still a bit of a mystery) they are back with, wait for it…. a new token and ICO to boot!
Following a Medium post from the illusive WCX team at the beginning of May announcing the launch of their new Exchange and Token on May 13th many investors began to feel their spirits lift, however I wouldn’t get your hopes up quite yet.
Who Needs Liquidity?
So May 13th has been and a new look website has been launched along with what appears to be a working exchange. They also allow investors of their original WCEX tokens to convert their tokens into the new XT Tokens with the click of a button.
Trading pairs are with BTC,LTC,ETH and what appears to be a new USD pegged token labelled USDC. Details on this token are non-existent and if it is the following ERC-20 token we found on Etherscan it was create about 9 months ago and has one holder with zero transaction so far recorded on the Blockchain. One would assume WCX themselves have created this token as a way to create fake liquidity on the exchange.
Here is there explanation of the token and how it works:
USDC (cryptodollar) is a cryptocurrency that simulates the value of the US Dollar. Its main utility is to keep out-of market funds in stable value. USDC derives its value from its peg to the BTC/USD rate.
At any time, the BTC/USDC rate is maintained to be approximately equal to the underlying BTC/USD reference rate. As a result of this peg, USDC simulates a fixed exchange rate with the US Dollar.
The paper continues on with how they maintain the ‘peg’ and how it’s value is determined but makes no mention of how these magic tokens conjured up using Ethereum actually get their worth. Unless the tokens are redeemable for dollars, i.e each USDC is backed by 1 USD then this is in fact just like swapping your Bitcoin for IOU’s.
Although many people on Twitter appear to have had some of their initial doubts on this project somewhat lifted, in our opinion this latest development only strengthens the case that this is indeed a scam, that is not to say you won’t be able to get access to your XT tokens and sell them before the ship sinks, but ultimately this project has one goal in mind, take as much Cryptocurrency from people as possible using their token sales and now with the USDC token, which is likely backed by nothing with an unlimited supply. USDC makes Tether look like solid Gold!
Be careful out there, the price of a relatively unregulated space is con artists have free range.