news

bitcoin

1 X bitcoin bitcoin =

Friday

15 November 2019

The Karatbars International Debacle: Global Currency or $6 Billion Con?

The Karatbars International Debacle: Global Currency or $6 Billion Con?


smart summary beta

Media titles, including Bitcoin.com, and notable Bitcoin evangelists like Andreas Antonopoulos, have claimed that Karatbars International has defrauded its investors of 120 million grams of gold, with an associated monetary value of 5.76 billion U.S.

Karatbars International generated this level of financial investments because they marketed themselves as a cryptocurrency that is based on the value of physical gold.

Karatbars International and its founders, Josip Heit, Alex Bodi, and Ovidiu Toma, claimed that the gold that was backing their currency was mined from a gold mining operation in Madagascar and that the value of such gold was being securely transferred into a digital currency.

Prior to the launch of KaratGold, the Karatbars company focused on selling gold products online through a business model predicated on ‘pyramidal affiliate marketing’ — a sales technique that functions similarly to ‘multi-level marketing.’ During this period, Karatbars International often found themselves in troubled waters, with their business practices being called into question by regulators in three different countries.

Despite this patchy history, Karatbars International launched their cryptocurrency brand KaratGold Coin (KBC) with a massive marketing campaign that featured endorsements from reputable news websites like CNN, Forbes, and Cointelegraph.

Karatbars capitalized on this purchased media attention, and attracted investors through glowing testimonials such as KaratGold being an ‘amazing opportunity,’ ‘the next payment system,’ and a product that is “impossible to be a scam.” These positive affirmations were matched by Karatbars purchasing of banner advertisements, influencer endorsements, and paid content pieces in web-based cryptocurrency media titles.

At this event, KaratGold (KBC) investors were promised, by Karatbars CEO Harald Seiz, a no-questions-asked 24-fold monetary return on their KBC coins.

At the July 4th investor’s event Karatbars promised that $2 worth of KaratGold coins (100 KBC) could be traded for one gram of physical gold which with a value of $48.

Since this, further speculation around the Independence Day event has included public accusations that Karatbars International staged the event in an attempt to increase the market value of their Ethereum-based KBC coin.

Since the debacle of the July 4th investors event, representatives from Karatbars, including the company’s CEO Harald Seiz, have used online videos to address the various accusations that Karatbars is facing.

This sentiment is supported by the reportings of a German media outlet that claims that the Karatbars CEO, Harald Seiz, admitted during court proceedings that the KBC coin is valueless.

Karatbars International owes its investors the return rate it promised — one gram of gold in exchange for 100 KaratGold coins.

Considering that Karatbars supply of KBC coins was a net total of 12 billion the company requires 120 million grams of gold in order to compensate its investors.

Karatbars International claimed that this new coin was connected to a cryptocurrency bank in Miami and has planned to host the token sale there.

Goto Full Article

bitcoin bitcoin price

$8490.89

24h

Live Average

bitcoin

News Article Sentiment

positive

Score (0)

Article Metadata

author

site

btcmanager.com
Market data feeds provided by cryptocompare.com
bitsmart 2018