Bitcoin is struggling to try to stay above $7,000. In that context, the Bitcoin skeptical crypto exchange, Bitcoin.com Exchange, has caused fresh controversy. This time it did so after it supported an altcoin that was majorly linked to scam activities. In a December 15 article and Twitter post, officials and analysts confirmed that the trading of HEX had gone live on December 13.
HEX traders encounter heavy volatility
That move has made Bitcoin.com become one of the few renowned trading platforms to make ties with HEX. HEX and its founder Richard Heart continue to exude many accusations of fraud.
Trying to explain the decision, Bitcoin.com alleged that it aimed to provide security to the investors wishing to trade the coin that launched earlier this month. The Twitter announcement read:
“We are thrilled to announce that we have just listed #HEX by @RichardHeartWin on our exchange, giving anyone who wants to trade it a secure venue to do so. Check it out!”
There is little trading data available. But, Bitcoin.com’s HEX markets have already traded more than 0.81 BTC ($5,700) in the past 24 hours. During that period, the platform’s two HEX trading pairs, HEX/ETH and HEX/BCH, have plunged in price by 57% and 64% respectively.
According to previous reports, HEX alleges to enrich investors through giving free tokens in return for confirming Bitcoin holdings. Various investors bought tokens using Ether. Heart quickly reacted to suspicions that the whole project was being run and managed in a manner that resembles a pyramid scheme. Thus, investors are sternly warned over HEX’s founder’s ‘perpetual self-enrichment.’
Critics and naysayers say that Heart, as the owner of HEX’s so-called “origin address,” is set to control almost 45% of the whole HEX supply just one year after its launch. That will get achieved by getting a consistent stream of HEX tokens from different transactions. Also, Heart will keep the ETH from purchases.
On December 7, a blog post on HEX made by the private researcher Goldman Sats summarized:
“Not only will Richard control close to half of all HEX after the first year, but it is the first token I have seen to have its founder’s perpetual self-enrichment baked into the protocol.”
Goldman Sats added that Heart aims to downplay the existence of the origin address. All that will happen in spite of its probable status as a huge centralized repository. The repository will have the ability to crash the whole HEX market with just one sell-off.
The trading arm of the crypto news outlet Bitcoin.com, Bitcoin.com Exchange, already has a controversial reputation among its community participants. Most are worried about its sidelining Bitcoin, which it refers to as ‘Bitcoin Core,’ while seriously supporting altcoin Bitcoin Cash.
Interestingly, the company’s owner, Roger Ver, has in the past tried to present BCH as the ‘real’ Bitcoin, claiming that the altcoin has better features as a currency. Allegations that have come up since BCH’s debut in 2017 include a resounding fact that the Bitcoin Cash network participation is overly centralized. The rebuttals also state that users would rather hold BTC but spend BCH as soon as possible.
After that HEX announcement, Twitter users led recriminations against Bitcoin.com. Most of the comments showed doubts and disbelief at the decision to launch trading services. Colin Talks Crypto responded wondering why they would make such a decision.