Pure Bit: Another Exit Scam

By Chetna Phour

After raising $2.8 million in an Initial Coin Offering (ICO), a South Korean cryptocurrency exchange Pure Bit shut down its operations overnight.

The exchange promised to deliver Pure Coin to its investors, but now the cryptocurrency exchange is completely shut down after posting Sorry and Thanks on their communication channels.

ICOs have become a way to steal the investors’ funds. Recently, BTC Wires has reported several exit scams including the Canadian cryptocurrency exchange, MapleChange’s exit scam. Though MapleChange said that in a hack, it lost all of its funds but most of the industry experts believe that it was an exit scam.

Read full post: MapleChange: Hack or Exit Scam

The website of Pure Bit is hosted by fake names, even the messenger, contacts details all were fake. The only hope is the movement of Ether which can help in tracking the scammers. The scammers raised $2.8 million in Ethereum from investors. At the time of shut down, Pure Bit had 13,000Ethereum. According to the business model of Pure Bit, the investors would receive a share of profit generated, and a discounted fee would apply to the investors. Now the users cannot access the website. When they are trying to access the website, it is showing the error message “Hmmm… can’t reach this page.” The social media accounts of Pure Bit are displaying Sorry, and Thanks message. The cryptocurrency exchange has removed most of its social media accounts including Facebook.

The cryptocurrency exchange Pure Bit has conducted a fairly routine exit scam. Initially, the cryptocurrency was pitched as an exchange token for Pure Bit which the exchange was planning to launch by the end of this month. The coin promised the investors to give shares of the trading revenue of Pure Bit and discounted fees for trading. The Pure Bit team claimed that it would burn 90% of token supply over a three year period. On 4th November the ICO’s ETH wallet displayed several in-bound transactions. Initially, on 9th November 500 ether was transferred out and after 20 minutes remaining 13,178 ether was withdrawn. As soon as the ICO ended the cryptocurrency exchange spirited away all the funds in a single wallet address.