Foin Scheme Locks Up Investors’ Money, Pumps Price: A Fraud?

A new altcoin phenomenon known as the FoPay cryptocurrency payments firm and wallet provider recently acquired the Estonia-based digital currency trading platform AliExchange for 1 million in its native Foin (FOIN) tokens. This was what the cryptonews sites reported at the time, whereas the apparent value of the FOIN tokens was somewhere around $2.1 billion.

Indeed, FoPay did claim as much in the press release that it issued – but there has been a trail of suspicious movements in the price history of the altcoin and a lot of shady business relationships associated with the coin’s development.

Even though our team at DC Forecasts did not cover the $2.1 billion Foin acquisition in the featured news, many altcoin news sites did. Now, we can see that the payment was made by the Swiss-based Foin Foundation which is the coin’s development entity that now has 20 million FOIN in its capital reserve which is over 20% of the coin’s total supply.

As the press release notes, the company is now planning to pay a small amount of Foin tokens to compensate the existing AliExchange shareholders following the buying, while the bulk balance will be kept in AliExchange as liquidity.

What is shady, however, are the price movements and company operations. If we look in the Foin scheme in detail, we can see that there is a number of potential red flags. First, the token was originally created in late July 2018 at a price of around $400 – and it gradually gained value throughout 2018 until a sharp move from $1,492 to around $2,574 on December 15. This was when the company unveiled the exchange acquisition and announced a suspension of investor withdrawals.

After that, FoPay suspended Foin withdrawals (until December 31 2019 which is today) ostensibly due to the merger with AliExchange. The company noted that “FOIN withdrawal service will resume on 1st January 2020. There will be NO further extension after this final deadline.”

Since the announcement of the suspended withdrawals, the Foin price has surged to around $3,200 at press time, representing a 70% month-on-month price increase. In a market like this, a movement like this is definitely shady.

With all the connections to a blacklisted firm and a lot of pumps and dumps, the Foin scheme is now definitely a red flag. While most of the cryptocurrencies are seeing adoption globally, there are still problems of fraud and murky business practices out there. This is why we advise every investor to be careful – especially in cases like the Foin scheme.