South Korean exchange PureBit Pulls Exit Scam, Takes Away 13,000 Ethereum (ETH)
PureBit, a small-scale exchange, closed completely over the weekend, shortly after the completion of the ICO.
PureBit, a new and small-scale South Korean exchange, closed completely over the weekend, exit-scamming with 13,000 Ethereum (ETH). Users noticed the exit, and later, South Korean Cryptocurrency & Blockchain News confirmed the event through Twitter:
https://twitter.com/BlockchainROK/status/1060840288489369600
The exit scam follows the sudden closing of an unrelated exchange, MapleChange in Canada, further underlining the dangers of storing funds on exchanges. However, access to small-scale, exotic assets has caused some users to prefer exchange wallets, instead of using multiple coin wallets.
In fact, the PureBit exchange had hardly started working before it pulled its ICO scam. ICO scams usually involve hyping up a project to raise funds and then emptying out the wallet later. The ETH raised during the token sale is already making rounds through several wallets flagged for participating in a scam. However, it is still theoretically possible that the ETH could be exchanged for an anonymous currency to be liquidated later.
Despite the ban on ICOs based in South Korea, the startup managed to place its tokens to international buyers. The asset was supposed to be an “exchange coin”, a model adopted widely by marketplaces, and seen as a certain source of returns based on exchange activity and trading fees. But soon after the token placement ended, PureBit removed its Kakao followers and disappeared from social media completely.
Korea has remained one of the hotspots for crypto trading despite the slowdown in recent months. For many assets, Korean volumes support the price levels. Leading exchanges remain relatively stable, but new marketplaces are attempting to coexist.
However, the Korean government is also planning a crackdown on exchanges deemed non-compliant with financial regulation. This regulatory stance has caused the Zeniex exchange to announce its upcoming closure on November 23 and with it the end of the ZXG digital asset.
https://twitter.com/TheNewsDotAsia/status/1061114034538332162
It is unknown which other markets may be affected, as small-scale exchanges continue to offer trading for a limited selection of niche coins. In the meantime, more established markets are shedding small-scale, illiquid coins to streamline their operations.