CoinsMarkets Exit Scam

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CoinsMarkets

CoinsMarkets operated out of Cyprus, with no visibility into their storage and fund backing practices. Ultimately, they ended up going silent and customers could only access a limited number of low-value coins.

This exchange or platform is based in Cyprus, or the incident targeted people primarily in Cyprus.

About CoinsMarkets

"CoinsMarkets serves as a platform for individuals interested in buying and selling Bitcoins using an assortment of world currencies." "CoinsMarkets provides an online tool that allows users to freely trade Bitcoins for a number of different currencies worldwide."

"Instant deposit/withdrawal all coin. Deposit will be credited after 10 confirmations. First 1000 members will receive a no fees account for life. Get free coins after sign up. All active members will get free coins give away. 24/7 Support. 99.9% of ticket will be answered in 1 h or less during working hours. All coins (With Pos ability) in your wallet will generate POS coin and automaticly get credited to your account."

"CoinsMarkets is a cryptocurrency exchange from Cyprus." "The Coinsmarkets domain was registered under a fake name that shows an address in the Netherlands. There’s a Bitcointalk topic called “Experiences with CoinsMarkets.com?” and somebody living near that address in the Netherlands went to check it out and there was nothing related to a cryptocurrency exchange at that address. It was just some wealthy residential area."

"Coinsmarkets is a cryptocurrency exchange that has been all but not working since January 5, 2018, with trading and withdrawals disabled. The Coinsmarkets exchange blames their server and database but really what happened?. In late January Coinsmarkets announced on their site that “trading would be enabled in a few hours” but after that, they never replied to a single query."

"All they allow to be withdrawn are worthless coins. In fact many of which aren’t even on CoinMarketCap, and there are around 350 coins listed at Coinsmarkets. It’s been almost three months and basically nothing has changed. Almost no communication. No legit business does that."

"The latest official announcement from coinsmarkets is, “Some coins face failed withdraw those will be processed manually, please hold on”. The news was released on May 15."

This exchange or platform is based in Cyprus, or the incident targeted people primarily in Cyprus.

The background of the exchange platform, service, or individuals involved, as it would have been seen or understood at the time of the events.

Include:

• Known history of when and how the service was started.
• What problems does the company or service claim to solve?
• What marketing materials were used by the firm or business?
• Audits performed, and excerpts that may have been included.
• Business registration documents shown (fake or legitimate).
• How were people recruited to participate?
• Public warnings and announcements prior to the event.

Don't Include:

• Any wording which directly states or implies that the business is/was illegitimate, or that a vulnerability existed.
• Anything that wasn't reasonably knowable at the time of the event.

There could be more than one section here. If the same platform is involved with multiple incidents, then it can be linked to a main article page.

The Reality

This sections is included if a case involved deception or information that was unknown at the time. Examples include:

• When the service was actually started (if different than the "official story").
• Who actually ran a service and their own personal history.
• How the service was structured behind the scenes. (For example, there was no "trading bot".)
• Details of what audits reported and how vulnerabilities were missed during auditing.

What Happened

The specific events of the loss and how it came about. What actually happened to cause the loss and some of the events leading up to it.

Key Event Timeline - CoinsMarkets Exit Scam

Date	Event	Description
January 5th, 2018	Main Event	Expand this into a brief description of what happened and the impact. If multiple lines are necessary, add them here.

Total Amount Lost

The total amount lost is unknown.

How much was lost and how was it calculated? If there are conflicting reports, which are accurate and where does the discrepancy lie?

Immediate Reactions

How did the various parties involved (firm, platform, management, and/or affected individual(s)) deal with the events? Were services shut down? Were announcements made? Were groups formed?

Ultimate Outcome

What was the end result? Was any investigation done? Were any individuals prosecuted? Was there a lawsuit? Was any tracing done?

Total Amount Recovered

There do not appear to have been any funds recovered in this case.

What funds were recovered? What funds were reimbursed for those affected users?

Ongoing Developments

What parts of this case are still remaining to be concluded?

General Prevention Policies

It's likely that customer funds were not stored securely in an offline multi-signature wallet, and may also have been misappropriated by platform operators. This is another one of those exchange operations which could have been easily prevented.

Individual Prevention Policies

No specific policies for individual prevention have yet been identified in this case.

For the full list of how to protect your funds as an individual, check our Prevention Policies for Individuals guide.

Platform Prevention Policies

Policies for platforms to take to prevent this situation have not yet been selected in this case.

For the full list of how to protect your funds as a financial service, check our Prevention Policies for Platforms guide.

Regulatory Prevention Policies

No specific regulatory policies have yet been identified in this case.

For the full list of regulatory policies that can prevent loss, check our Prevention Policies for Regulators guide.