Verge (XVG) hit 10 cents on Thursday, representing an appreciation of more than 200% since March 18 low of about 3 cents. Notably, the coin, which claims to offer anonymity, appreciated despite the overall bearishness that had gripped the cryptocurrency market last month. In the past 24 hours, the cryptocurrency has seen a correction of about 10%. While loyal followers of Verge call it a dip, a growing number of skeptics are calling this as an exit scam.
Before we go into those details, let us look at the controversies which surrounded the cryptocurrency in the past. The price of the coin rose to about 30 cents on Christmas eve, from less than a penny in early December. John McAfee’s tweet was credited for the rally. It surpassed even Bitcoin as the most talked about cryptocurrency in Twitter. A big Verge investor (going by the twitter handle “XVGWhale”) revealed that McAfee demanded a higher fee for the tweet. Their conversations were also published by XVGWhale.
McAfee later revealed that he charges $100,000 for a tweet related to a cryptocurrency. This tantamount to market manipulation.
Wraith Protocol, the most anticipated release from Verge (XVG), was expected to be released before 2017 ended. However, the developers missed the deadline, leading to a panic selling that brought the price down to about 1,178 Sats. The official Verge currency Twitter account cited issues related to transaction fee handling as the reason for the delay. When the OSX client, with Wraith Protocol support, was released, Sierra users faced issues and were asked to run terminal commands to sort out a bug causing the client to crash.
In March, unexpectedly, the Verge team started a crowd funding campaign to raise $75 million. The team also promised to reveal a mystery partner once the goal is reached. Much before the campaign ended, the necessary amount was raised. Many crypto enthusiasts claimed that Verge is partnering with Tokenpay. However, Derek Capo, CEO of TokenPay, publicly announced that TokenPay is NOT behind the mystery partnership. The crowd funding campaign, in a way ensured that Verge remained in the green, while the rest of the market was bleeding. While everyone was expecting details of the big partnership, the Verge team has postponed the announcement date to April 17.
The crypto traders, in the meanwhile, noticed a huge chunk of XVG was moved to Binance.
One of the Verge’s lead developers (Justin Vendetta aka Sunerok) had claimed that it is for the payment to be made for Ledger integration.
Over 18,000,000 $XVG from their ‘partnership crowdfund’ has been moved to Binance. Sunerok and another #Verge team members claims they need it to pay @LedgerHQ. @BTChip claims that nobody from the Ledger team is working on integrating XVG. #VERGEFAM, time to open your eyes! pic.twitter.com/xiQh93kek1
— Mike V ⚡ (@TradingWhaIe) April 14, 2018
However, Ledger’s CTO immediately denied saying their team is not working with XVG. Further Ledger’s CTO has also tweeted that they no longer charge for coin integration.
Hello. Ledger does not charge for coin integration anymore. Either the integration is provided by the community, which we help for free, or we follow our own integration roadmap. Have a nice day.
— Fred de Villamil 🤔 // Ledger (@fdevillamil) April 14, 2018
A highly-upvoted comment by another Redditor had the following hypothesis:
(1) Justin Sunerok is having trouble raising money to pay his taxes. (2) Justin Sunerok launches desperately fast crowdfunding to raise approximately $3 million in XVG tokens. Says it is for a partnership. (3) Justin Sunerok says the partnership will be announced April 16, the day after the final deadline for filing taxes.
While the crowd funding saga was going on, Verge network faced a 51% attack. While Verge claimed that only 250,000 tokens were lost, many in the Reddit community have estimated that as much as $3.9 million worth coins could have been stolen. Verge tried to underplay the attack as much as possible.
Notably, the lead developer Justin E Valo had been arrested eight times in the past, albeit for minor crimes. Still, it is a matter of concern to many investors.
The unanswered question of moving millions worth XVG raised through crowdfunding is a massive red flag according to several members of the Reddit community. Only time will tell whether the investors who sold the coin during the recent rally are wise or not.