You know those warnings that you hear about ICO scams in the cryptocurrency markets? Those warnings about companies issuing ICOs and then running away with the money they raise? Well this is one of those warnings! We are here to warn you about a company named Santiment. Santiment is a company that claims to be the Bloomberg/Reuters of the cryptocurrency world. They claim to supply Market Datafeeds, Newswires, and Crowd Sentiment Insights for the Blockchain World. Well, we actually looked into these claims and this is what we found.
Use case does not require blockchain
If you read TechCrunch, they released an article about the six flags of ICO scams. First red flag on the list of ICO scams is that the use case does not require Blockchain. This is in fact true. Santiment claims to provide data feeds for Blockchain, but all you need is an application that users can download and use throughout the day as they trade cryptocurrencies. You don’t need blockchain for that, and in fact, nothing in Santiment’s source code has anything to do with blockchain.
Mining structure disproportionately favors development team
This is the third red flag on TechCrunch’s list. Look at the image featured above. You will see 9 wallets that hold 85.59% of all tokens. Can you guess how many people are on the development team? Keeping a constrained supply while demand for the token creeps higher is a tactic often used by such scams. It is important to note that there is a maximum supply of 83, 337, 000 SAN tokens, so supply is already constrained. By artificially keeping the supply low, the Santiment team is artificially driving up the price of SAN tokens. Even the slightest bit of demand would drive the price of SAN tokens up. This is one the hallmarks of all ICO scams. According to the TechCrunch article:
Paycoin, whose founder was found guilty of operating a $9 million fraud scheme, had the majority of their tokens reserved for developers on the project. Favoring the development team could be an indication that the team’s intent is to maximize their personal financial gain from the appreciation of the token, rather than maintain the viability of the blockchain network over time.
If that wasn’t enough to convince you, then maybe this will. If you go to their whitepaper and scroll down to page 18, you’ll see a graph listing the following:
- Since Santiment is being developed primarily by the team, 18% will go to the team to incentivize their continued efforts.
- 4% to key advisors and partners.
- 6% goes to the Reward Pool to incentivize network participants, a reserve to be used by Santiment, at its sole discretion,.
- 18% goes to the presale participants for their early support.
- 54% goes to the crowdsale participants.
If 54% of the crowdsale is supposed to go to participants, why does one wallet still hold 52% of the tokens? Does this mean that only 2% of the tokens went to the participants? How many participants were there? Another wallet holds 17.6% of all SAN tokens, can you guess what that wallet correlates to? Yep, those presale participants only got 0.4 % of it. The remaining ten percent were supposed to go to Key Advisors, Partners and Network Participants, but they ended up being split between 7 different wallets. This means that over 85% of the supply of SAN Tokens is held by nine mysterious wallets.
Anonymous team or team with weak experience
Third red flag is an anonymous team or a team with weak software experience. First of all, not one of the team members has their pictures on the website, all pictures appear externally (for all we know, these people could have no idea they are being associated with this token). The only one that has appeared in any videos is the founder, and to be honest he doesn’t strike me as the next Michael Bloomberg. The CTO has a link to his Github profile, but it seems he has experience in building e-commerce databases and applications for wedding agencies. We don’t know how you can go from doing that to becoming the next Reuters/Bloomberg.
If you are still not convinced, checkout their mobile application. The thing looks like it was built by 12th graders that have just discovered that you can build mobile applications without much programming experience. Don’t even bother reading all the negative reviews, just go straight into the application and you will know what I’m talking about.
The company claims that the mobile application is an MVP, but that is not what MVPs do. A minimum viable product is one that gets the job done and can be sold to customers. The reality is that you’ll be hard-pressed to sell this application to pre-kindergarten students.
Insufficient information on website/whitepaper
Fourth red flag is that there is little to no information on the website. This is probably the biggest red flag for this company. Just take a look at their road map, it is nothing but nonsense jargon used to confuse the novice investor. I mean what is a due diligence stream? The word data/datafeed is used 8 times, but the only data we can find is how 3 people felt “cattish” about Bitcoin on their mobile application. What is a Rumour’s Feed? We are proud users of the Bloomberg Terminal and Reuter’s Eikon platform, yet we have never came across a “Rumor’s Feed”.
Aside from the lack of viable/tangible product, the company lacks a sufficient whitepaper. Just go take a look at their published whitepaper, does it seem like a whitepaper for a data company or a whitepaper for a bookclub? Is it technical enough for you, or does it seem like a huge pile of worthless jargon. You be the judge!
No clear roadmap
Without a doubt there is a road that this company is heading down, but make no mistake, there is no map! We are willing to give away 1 full Bitcoin to anyone that can explain this company’s roadmap. Just take a look at it for yourself:
There Is A Scam Of The Scam
If you thought it doesn’t get any better, then wait until you hear this. The company’s website has a replica scam website (crowdsale-santiment.net) that asks users to send Ethereum when you click on the token sale. The irony is too much to handle here. Most cryptocurrencies/tokens have a .org domain associated with their projects. Santiment on the other hand had only managed to obtain a .net domain. Without a .org domain, scammers can easily replicate the site and fool investors into sending them Ethereum. At this point we are not sure what is worse, going to santiment.net or crowdsale-sanitment.net, either or, you would be getting the same deal!
Nailed 5/6 of TechCrunch’s Red Flags + 1 Extra Bonus
You see, we have nailed 5 out of the six red flags that were mentioned by the TechCrunch article. Even better, we landed a bonus point for discovering a scam of the scam. We did however forget to mention one important point raised by that same article. You know how they say if something seems like a scam, then it probably is. We are here to tell you that this thing is a damn scam. Put it this way, Reuters does $11 billion in annual revenue while Bloomberg does around that same figure. Do you really think that they are just going to sit idle and let “Santiment” take their place in one of the hottest markets of our lifetime? I will leave it for you to decide. I have done my part in warning you!