It’s alarming to find that BigWhale.io, has faced the wrath of the Texas State Securities Board, represented by Commissioner Travis J. Iles. This decentralized finance (DeFi) protocol, built on the popular Binance Smart Chain has been asserting its association with the Russian government while promising passive income opportunities. This has resulted in a cease and desist notice being issued against the company, essentially curtailing its operations.
While the firm certainly sounds tech-savvy, offering asset lending via a decentralized app, the nature of its claims does raise eyebrows. An ambitious return of almost 500%, compounded daily for 90 days, seems audacious. Even more concerning is the alleged use of social media and online influencers to market its dapp through a multilevel marketing scheme, with promises of substantial compensation, bringing the credibility of their operations under scrutiny.
It’s also troubling to observe how the company has chosen to remain evasive about its capitalization. Not disclosing such basic information alongside the absence of details about their executives and office locations is indeed a cause for concern. As Commissioner Iles rightly points out, “Concealing the identity of persons entrusted with money is an enormous red flag”.
Rather worryingly, despite the firm vouching for the security of its program, an audit has indicated that BigWhale.io seems to be using investors’ deposits to reward other people, resembling the workings of a Ponzi scheme. Once bitten, twice shy, so it seems, as BigWhale.io reported a significant loss of investor’s funds after a hack on Oct. 3. However, their response has been less than professional, with threats to utilize assets from the Russian government.
In the realm of decentralized finance, transparency should be at the core. Every investor deserves to know who handles their money and how it is being used. But the case of BigWhale.io presents a bleak picture. While DeFi platforms offer promising financial solutions, there’s a pressing need to have more robust regulations ensuring transparency and protecting investors. If not, incidents like the one involving BigWhale.io may only become more common.
Source: Cryptonews
