- The story of the Centra Tech scam is almost over, as the second co-founder was jailed
- Centra Tech has come to embody the ICO boom of 2017/18
- From inception to demise, no other project encapsulates an era quite so much
The Centra Tech scam is one sentencing hearing away from its conclusion, and when all is said and done it may well rank as a perfect embodiment of the worst side of the crypto ICO boom. We run through the reasons why Centra Tech embodies the worst of the crypto gold rush from its inception to its demise.
Money Grabbing Scam
Centra Tech was nothing but a money grabbing scam from the outset, with the only intention being to fraudulently take as much money from investors as possible. In the end, co-founders Sohrab Sharma, Robert Farkas, and Raymond Trapani illicitly obtained some $32 million worth of cryptocurrency from investors.
Without any limitations except their imagination, the three co-founders were able to make all sorts of promises in the whitepaper. This they did, promising to ‘bank the unbanked’ by offering a Centra wallet and card which as well as a patent-pending ‘currency clearance engine’ to enable quick conversion of cryptocurrencies. Anyone using their card could spend money from their wallet anywhere where Mastercard is accepted…apparently.
Centra Tech also offered a Centra Tool Kit which was designed to “create the next level of integration and scaling of our services to a worldwide audience”, offering any exchange the chance to create their own branded debit cards and more.
The ICO boom wouldn’t have been the ICO boom without some cringe celebrity endorsement. And Centra Tech delivered, famously roping in Floyd Mayweather and DJ Khaled to promote the token, naturally without admitting it. In late 2018, Mayweather and Khaled both settled with the Securities and Exchange Commission (SEC) for their parts in promoting the scam.
No one wants real partnerships do they? Really? Not in a scam, anyway, and that’s just what you got with Centra Tech. The three co-founders falsely claimed partnerships with Bancorp, Visa, and Mastercard, suggesting that the latter would distribute their debit cards.
Not content with this, the three brigands also completely made up a CEO, Michael Edwards, whose picture changed in the Centra Tech literature from document to document.
Every good ICO scam needs to be investigated by the SEC, and that’s of course just what happened to Centra Tech. In April 2018 the SEC stopped the project from going ahead, charging Sharma, Farkas, and Trapani with “orchestrating a fraudulent initial coin offering” and collecting $32 million from it.
Creators Sent to Prison
In the most fitting of fitting ends to the Centra Tech scam, the three founders all face time in prison for their crimes. Farkas and Sharma, who pled guilty, face a year and eight years respectively, while Trapani, who initially vowed to fight the charges, is yet to be sentenced, although a jail sentence is almost inevitable in his case too.
Centra Tech is the Archetypal ICO Scam
From its inception to its demise, Centra Tech indeed acts as the archetypal bull run ICO, a hair brained, overly ambitious, factually inconsistent money grab that ended with a SEC investigation and prison sentences for the founders. If there’s an ICO that embodies the worst of the gold rush that was the 2017/18 ICO boom then we’re yet to see it.