This Nigerian Crypto Exchange Valued At $50 Million Is Raising Suspicions, Here’s Why

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Nigerian crypto trade Patricia has raised suspicions following its newly launched Patricia Stablecoin labeled PTK and its unilateral resolution to transform customers’ funds to its stablecoin with out its customers’ consent.

Patricia’s Doubtful Transfer

In Might 2023, the Nigerian trade Patricia reportedly fell sufferer to a hack and reportedly misplaced near $2 million. Throughout this era, purchasers and customers confronted lots of difficulties having access to their funds as Patricia froze all withdrawals in its platform and supplied a press release to guarantee its fearful customers in regards to the state of affairs of their funds.

Nevertheless, Patricia customers had been nonetheless capable of withdraw their funds through the crypto trade’s newly launched app often called Patricia Plus App, however just a few withdrawals had been processed because the platform couldn’t course of all withdrawal requests.

Just a few months after the hack, Patricia introduced the introduction of its native token Patricia Token (PTK) on August 18, a stablecoin pegged to the US greenback, as a method to rectify its incapability to satisfy person withdrawals. Though related to the trade’s hassle regarding cash, it additionally looks as if the token was launched for fundraising functions.

Nevertheless, following the introduction of its stablecoin, Patricia has unilaterally transformed its customers’ funds to its newly launched stablecoin with out searching for consent from its customers, sparking hypothesis in regards to the token’s launch and a possible exit rip-off.

The trade took to X (previously Twitter) on August 18, 2023, informing its customers that each one present excellent BTC and Naira balances shall be recorded in Patricia Token.

These actions have raised a lot of criticism among the many crypto group as some group members already flagged these actions as a possible exit rip-off by the trade.

“That is all of the pointer it’s good to affirm that your cash is gone. Patricia has simply upped the extent of fintech rip-off. Convert customers cash to nugatory testnet tokens – manipulate an preliminary pump to evoke euphoria, sweep the complete rug and blame it on ‘the market’,” an X (previously Twitter) person on said August 19, in response to the announcement made by the trade.

One other person took to X (previously Twitter) in response to the announcement calling the transfer an ‘Exit rip-off Professional max’ and emphasizing that customers will not be going to get again their funds.

Thus far, native crypto group members have indicated different a number of potential elements of fraud towards the introduction of the Patricia token (PTK). A few of these had been the token being absent from cryptocurrency platforms that present advanced details about a token similar to CoinMarketCap and CoinGecko, and PTK not present on extensively used blockchains which can be usually used to launch native tokens.

Different crypto lovers have blasted the trade for not having the ability to present a proof-of-reserve for its native token. “This looks as if a rip-off earlier than you possibly can say your token is backed by the US greenback. There must be a proof of reserve,” an X (previously Twitter) person said.

When Did The Hack Occur?

Patricia’s alleged hack that resulted within the trade shedding near $2 million in Might 2023, was reported to have really occurred in January 2022.

The trade had closed all withdrawals in late Might 2023, claiming the trade skilled a hack that affected the retail buying and selling software and that each Bitcoin BTC and Naira belongings had been compromised in an e mail.

Following the announcement, knowledge from nameless sources indicated that the hack occurred in January 2022. Patricia suspended withdrawals and switch of crypto belongings to different wallets on its platform however continued to permit deposits.

Throughout this era, Patricia got here up with a suggestion to buy its customers’ crypto belongings and to compensate them with money to be able to deal with the state of affairs. Nevertheless, this provide was non permanent and ultimately got here to an finish in March 2023.