Cryptocurrency Scam: DJ Khaled and Floyd Mayweather Sued for Promoting Fraudulent ICO

DJ Khaled and Floyd Mayweather are facing legal troubles from victims of a cryptocurrency scam. The affected investors say the pair contributed to the Centra Tech ICO scam. 


Famous Boxer and Celebrity Music Producer in Hot Soup 

According to TMZ, the two celebrities are being sued for endorsing the Centra Tech cryptocurrency ICO. Back in September 2017, both the boxer and the music producer published tweets endorsing the Centra Tech project. 

DJ Khaled, in particular, called the project “the ultimate winner” and “a game changer.” On the back of these glowing recommendations from personalities as well-known as the pair, the Centra Tech ICO raked in more than $32 million during the crowdsale.

 

The plaintiffs in the class action suit say the endorsements by the two celebrities provided legitimacy for the Centra Tech scam. Inside sources say TMZ obtained court documents showing the pair as co-defendants in the case. 

DJ Khaled

The Centra Tech Cryptocurrency ICO Scam 

Earlier in the year, the United States Securities and Exchange Commission (SEC) charged the Centra Tech founders with wire fraud and securities fraud. According to the indictment, the founders of the project falsely claimed to have partnerships with Visa and MasterCard. 

Based on these fake claims, they sold a debit card that was purportedly capable of allowing users to convert Centra tokens (CTR) in fiat or spend the CTR tokens. According to the SEC, such a partnership did not exist. The three founders – Robert Farkas, Raymond Trapani, and Sohrab Sharma – face up to five years in prison. 

The indictment was a part of a sweeping clampdown against ICO fraud by the Commission beginning in late 2017. At the time, the SEC was worried that unscrupulous elements were using the mania around cryptocurrencies to defraud unsuspecting victims in numerous “pump and dump schemes.” 

ICO scam

Celebrity Endorsement and Fake Cryptocurrency Businesses 

DJ Khaled and Floyd Mayweather aren’t the only celebrities to be caught up in shady cryptocurrency businesses. Others like rapper The Game and Paris Hilton have also touted ICO projects that turned out to be nothing more than a website, and no actual product. 

The SEC issued warnings to celebrities telling them that such endorsements could violate U.S. securities law. According to the Commission, business promotional activities without any an accompanying disclosure of compensation for such endorsements could land celebrities in hot water. There have also been instances when ICOs published fake endorsements luring people to invest in the project.  

Do you think celebrities should stay away from endorsing cryptocurrency businesses? Please share your thoughts with us in the comment section below. 


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Blockchain Technology Could Be the Future of Franchising

Blockchain continues to make strides in the modern world, and not solely through cryptocurrencies. From art to football, the next stop for the technology appears to be franchising.


We know that blockchain technology’s intrinsic characteristics allow it to be used in a range of businesses and not just for cryptocurrencies. Live Bitcoin News has reported on it being integrated into supply chain management processes as well as it being used to improve healthcare systems.

A New Use for Blockchain

According to Forbes, another interesting avenue for blockchain to explore is franchising. This prospect was discussed at the recent International Bar Association’s Franchise Law Committee meeting in Italy. Craig Tractenberg, of law firm Fox Rothchild, said:

One of the roundtable discussions dealt with the use of blockchain technology in franchising. Those familiar with blockchain technology know that it can be used beyond cryptocurrency transactions and applied to any record keeping. The anticipated uses of this digitized public ledger technology are for digital payment, smart contract, and database – record management systems.

One of the key features of disruptive technologies is that they cut out the middleman in any equation, which, depending on the business, could result in more efficient processes and less money or commissions paid to third parties. This peer-to-peer approach could also make use of smart contracts, which are self-fulfilling agreements that are concluded once certain pre-determined conditions are met.

Tractenberg elaborated on this while referencing a few platforms, saying:

The discussion itemized the commercial application of the technology to the franchise context. Cited was FOODCOIN Ecosystems as a global marketplace for food and agricultural products designed to eliminate intermediaries through the use of smart contacts. Another emerging company is FANTOM Foundation, which has apps for food reservations, geolocation and supply chain management. Carry Protocol, provides merchants and customers a platform to communicate and understand each other, and is effectively an advertising channel.

Live Bitcoin News actually recently reported on how major retailers like U.S.-based Walmart and France-based Carrefour are making use of the technology to track and trace certain fresh produce items.

Rewarding Customers in Crypto

Another way for blockchain to be used in the retail sector is through rewards programs. Chanticleer Holding, whose stable includes American Burger and Hooters, has actually introduced a loyalty program for the latter. The group’s CEO, Michael Pruitt, explained:

Customers can have a cryptocurrency loyalty program across all Chanticleer Holding brands — and beyond. It runs on the MobivityMind commerce platform, and will pay out in Merits, a cryptocurrency that’s leveraging the same infrastructure and principles of Bitcoin, Ethereum, Ripple, Litecoin, and more.

Live Bitcoin News recently ran an article on how certain companies in the beauty industry have plans to reward their loyal clients in crypto, which will not only grow their customer base but will also increase the usage and adoption of cryptocurrencies in the retail industry.

Do you think that franchising is the next stop for the blockchain train? Let us know in the comments below!


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Crypto Lending On The Rise: Genesis Capital Issued $553 Million in Crypto Loans Since March 2018

Crypto loans appear to be in high demand. This somewhat unusual business model is generating a lot of excitement. Genesis Capital has seen the number of loans issued through its platform increase significantly. Over $550m worth of cryptocurrency has changed hands over the past seven months.


Genesis Capital is on the Right Track

In March of 2018, Genesis Global Trading, an OTC cryptocurrency trading firm, launched its crypto lending platform in response to growing customer demand. Through its affiliate company, Genesis Global Capital, institutional clients are able to lend and borrow a variety of cryptocurrencies. The success to date has been far more spectacular than anyone could have predicted.

Genesis Capital has originated more than $550 million in crypto loans

According to the company’s most recent report, 2018 has proven to be quite prosperous. To date, Genesis Capital has originated more than $550 million in crypto loans. Their clients are all institutional-level, further confirming the demand for exposure to Bitcoin and other cryptocurrencies. Interest in Ethereum is on the decline, whereas XRP, Litecoin, and Ethereum Classic have become a lot more popular.

Nearly a dozen cryptocurrencies are supported on the platform, though Bitcoin still remains the go-to asset. It is the most widely used asset and benefits from a very strong market position. Surprisingly, most borrowers use BTC for working capital needs. Ethereum is primarily in demand for short interests. Other trading firms also rely on Genesis Capital to borrow Bitcoin. This is primarily due to a boom in derivative markets.

Future of Cryptocurrency Lending

The Future of Cryptocurrency Lending

Despite falling prices for all cryptocurrencies this year, Genesis Capital shows there is still a bright future ahead. Unlike traditional financial assets, Bitcoin and altcoins are global. As such, requesting and extending loans around the world becomes a lot more straightforward.

Hedge funds have begun paying more attention to this company as well. This shows interesting things are bound to happen across the cryptocurrency industry. Moreover, it shows these companies believe digital assets are here to stay. Whether in the form of lending or something else entirely, the demand appears to be genuine.

As one would expect, cryptocurrency lending can serve many purposes. September was a monthly primarily focusing on operating work capital. Trading and arbitrage both remain incredibly popular as well. Speculating and hedging are on the decline a bit, yet still present. Genesis Capital is confident derivative markets and their products will continue to mature. This will lead to even more demand for these types of loans in 2018 and beyond.

Do you think that the cryptocurrency lending market will continue to grow? Let us know in the comments below.


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