Oh Cryptsy, you've done it again. This time it's not losing customer deposits for months, robbing them of proper exchange rates, hiding customer deposits without telling them, or locking up large sums of money. No one has (yet) sued you over this one. No, this time you've gone and tied your future to the future of Paycoin, the most scam-ridden, hype-driven, fraud-tainted, lie-based altcoin the cryptocurrency world has ever witnessed.
This is an op-ed.
E-mail dumps have revealed a great deal of collusion between you and Josh Garza in regards to Paycoin. Surely at some point you, too, believed that Paycoin would be worth $20 because Garza said so. Which would translate into a lot of fees for you, as people rushed to either buy XPY or dump it at the elusive price. This much is forgivable, in my book. You are, after all, in business to make money, right?
But you've screwed the pooch something fierce on this one. The scammiest part of Paycoin is its “Prime Controller” feature. These prime controllers are a chosen few wallets which stake at a crazier rate than usual. Let's be honest: 100% staking is crazy. 350% staking is, well, 3.5 times as crazy as that.
For all the nonsense you guys are manufacturing in your secret Miami labs, cocaine dust coating the window sills, you cannot reasonably justify accepting one of these wallets. It further embeds you in the scheme and implicates you in the coming three-letter-agency hellfire that is going to rain down on Josh Garza, Geniuses at Work, and everything associated with them. They had their chance to exit quietly, after their mining hardware stopped being profitable. I think we can all agree the world would be a better place if they had just kept on with that.
Like you, Cryptsy, we do what we do to make money. We're not on some holy crusade, at least not most of the time. Garza has particularly earned a place on our list of bad guys to expose, but this, admittedly, has a lot more to do with him harassing our writers than it does with his evil ways. Is he an evil bastard? Of course he is. Would that customarily make him so fun to write about? Of course it wouldn't. The world is full of evil bastards. Every post would be an encyclopedia if that's all we wrote about.
I'm sorry. I used to love you guys. You were my first exchange, and after Bter bit the dust, I started trading with you guys exclusively. Admittedly, now and then I've traded on C-Cex for coins you don't list, and on Bittrex when rates were better on certain things. I've used ShapeShift from time to time to make a quick conversion, like when I want to play dice but don't want to spend BTC to do it, I convert a little LTC or something else to do so. ShapeShift is nice for that, but they don't have the variety you guys do. They also don't allow me to convert to fiat, but let's be honest, not many people are doing that with you, since to get the cash they'd have to wait on a check from you. Which involves a certain serious level of trust you have now, perhaps irrevocably, obliterated.
Which brings me to the other point. What right did you have to immediately list Paycoin on the dollar exchange, thereby weakening the other coins you've got on there? Nevermind that you've got something called “Reddcoin” on the dollar exchange that is totally useless. Nevermind that. What, honestly, did Paycoin offer, besides a lot of hype, that other, more deserving altcoins didn't? Backroom deals, of course. But this isn't how you explain it in your blog. No, in your blog, you say:
A goal of a decentralized system is to keep it decentralized - if you have too many important nodes in a system like this in the hands of the very few, it can very bad. These nodes need to be distributed to as many trusted entities as possible. I hope that you guys consider us a trusted entity.
Well, surely we'd love to consider you a “trusted entity,” but of course that would require an immediate delisting of Paycoin, an admission of guilt, and an apology. Then there's this little tidbit to explain. Why on earth are you so close to a coin creator? Do other coin developers have this kind of access to you? I mean, let's be honest here: your customers have a hard enough time getting you to solve disputes!
You can try all you want to delineate some arbitrary division between Garza and Paycoin. Others are attempting the same thing. This community is far too intelligent for such a gambit. Give it up.
You've got no business washing the proceeds of a scam. It does no one any favors, and it will certainly alienate the rest of the cryptocurrency space. After all, it's not like you let us make margin trades, shorting Paycoin from the beginning. Some of us would have gotten quite rich if that were a possibility. Probably many of us wouldn't be so upset with you.
We'd have laughed all the way to the bank as the price of XPY dropped and dropped and dropped. But now we're all suspicious of you. We suspect that you're artificially inflating the price of Paycoin above a certain level. Certainly you don't believe it's worth more than a Dogecoin, do you? What actual utility has it had? It has been associated with known scammers, has been revealed to be based on lies, and has been mostly traded by the sheep-like followers of Garza, a herd which has found itself thinning at a rapid pace recently, the impoverished “investors” now either suicidal or sorrowfully wizened.
I have to tell you something, Cryptsy. A little secret. Bittrex has never looked so good to me. On a personal level, I can't be bothered with Bleutrade. The founders of that exchange used to work for Microsoft. Bittrex won't have a problem de-listing Paycoin if the community demands it. The evidence has overwhelmingly proven that, despite what you say, the vast majority of the Paycoin “trading” (read: dumping) that has gone at Cryptsy has been a single entity, using multiple accounts, gleefully manipulating the market. It's been Josh Garza and his crew fire selling the worthless token in order to keep the business afloat when it hasn't been pure greed.
Accepting a “prime controller” feels so wrong that it seems to be coming out of the Twilight Zone. Where has your sense gone? You've got to deal with the very same regulators that are going to eventually punish Garza in ways yet undecided. Is there even a punishment harsh enough for a guy who willingly encourages people to invest their children's college funds in a scheme he already knows will fail? Do you really want to be on that side of this?
So you ran a poll and the majority of responses, though some were ridiculous, came back that you have no business keeping this Prime Controller. Moreover, a substantial number of people were requesting in their responses that you delist the coin. I never thought I'd fall in line with the others who long ago started calling you “Craptsy,” but if you keep XPY/USD alive for even another week, I think I'll have no choice.
The only way to save face is to remove XPY from the exchange, thereby exculpating yourself from the crimes of Josh Garza and Team XPY and vindicating yourself from the Kool Aid induced idiocy of the GAW cult. Otherwise, if it smells like crap, looks like crap, and trades pure crap, it must be Craptsy.
Last modified (UTC): April 28, 2015 6:35 PM