Cryptocurrency Scam?
Editor's note: This article is public for paid and free subscribers.
Several hundred thousand crypto traders found themselves unable to access their accounts yesterday on the Thodex Cryptocurrency Exchange, according to the Daily Sabah news agency in Turkey as well as Bloomberg News. Thodex began operations in Turkey back in 2017.
Problems began Wednesday with an outage on the exchange, supposedly for maintenance, that lasted six hours.
This was followed by news that Thodex's CEO, Faruk Fatih Özer, flew out of Turkey headed for Thailand on Tuesday. He is rumored to have taken $2 billion in digital assets with him. Mr. Özer is also said to have frozen his social accounts for a while.
Various excuses have been offered by Thodex and its CEO. I expect more details will follow soon that result in tremendous relief or a terrible nightmare for Thodex's clients.
What's the moral of the story? I don't know. This story isn't over yet, but I fear a bad ending soon.
There is certainly at least one moral of the story or lesson here, of which we shouldn't need reminding.
Lesson to be Learned
Is there a lesson here? You bet!
I won't attempt to advise anyone to steer clear of cryptocurrencies. However, I strongly encourage you to do your research on any investment, especially cryptocurrency.
Our lesson to be learned; remember the old saying, "Don't put all your eggs in one basket."
Is there a lesson here? You bet! ...remember the old saying, "Don't put all your eggs in one basket."
I sincerely hope most of Thodex's clients don't have all of their money tied up in cryptocurrency. I fear many of them do as this cryptocurrency craze can affect people's good judgement.
My Concerns
I have some concerns about cryptocurrency that I'll touch on here. Many cryptocurrencies support complete anonymity for investors or owners. That may appeal to some people, however, I think it may contribute to little or no oversight by governments or audit agencies with how cryptocurrencies are created and managed.
Also, the mystery and secrecy around cryptocurrency creation along with inadequate oversight may lend itself to back door access by cryptocurrency creators or developers.
Of course I am no expert. I may just be suffering from financial paranoia. Time will tell.
Back to the Thodex Cryptocurrency Exchange, I will be watching as this situation plays out. My fingers are crossed that this is all a big misunderstanding! Unfortunately for the affected Thodex clients, I fear much worse!
A Simple Question
Question for you. Do you have all your eggs in one basket?
Here are links to the news articles I read at Daily Sabah and Bloomberg.
Thank you for reading!
Mike Bishop
Editor, The FIRE Letter
Disclosure: I do not own any crypto currency, either directly or indirectly through a fund or ETF, just in case you weren't sure.
Disclaimer: All strategies including recommended trades published here are for educational and informational purposes only. They are not recommended for any specific individual, business, or other legal entity. I don’t know your age, income, personal or financial circumstances and cannot possibly suggest any financial or investing decisions for you. Seek advice from your accountant, financial advisor, and attorney before making any investing decisions. Always conduct your own due diligence before making any investing decisions. Seriously!
