Envion the Enron of the Cryptosphere: Past-ICO Review

  • Eric Eissler
    ⭐ Features

    CEO creates a wealth of additional tokens and passes them to a friend and his wife, who then become the majority token holders with 61 percent of the shares

Envion the Enron of the Cryptosphere: Past-ICO Review
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It’s rather fitting that these companies both have names beginning with En, in fact it is wildly ironic. Mathias Woestmann is or was the CEO of Envion, a company that promised to use excess power from solar grids to create decentralized mining rigs for crypto. There is a snazzy video of them drop-shipping shipping containers full of rigs at some solar panel energy farms.

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The crime

Woestmann created an illegal capital increase without the founders’ knowledge, which, in turn, diluted the founders’ ownership down to a 31 percent minority share- now Woestmann’s friends have the majority stake and can make decisions without any checks or balances. New shares created via the capital increase were given to Sycamore GmbH, a company owned by Woestmann’s longtime friend Thomas van Aubel and his wife Jutta Freifrau von Falkenhausen. The judges ruled that van Aubel and von Falkenhausen knowingly acted illegally by receiving shares and share responsibility for the serious consequences to the founders.

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The aftermath

The founders’ spokesman Michael Luckow commented on the case by stating the following:

Van Aubel and his wife, Jutta von Falkenhausen, are clearly behind the Envion coup. Woestmann is just a henchman, a lackey. Woestmann finally admits in his press release precisely what van Aubel tried to cover up, even in court, that van Aubel had the company hijacked by his friend Matthias Woestmann at the expense of investors who have now lost a lot of money. Woestmann and van Aubel have thereby destroyed a lot of investors’ capital.

In June, a German court stated that the dilution of the founders’ majority ownership, resulting from a capital raise executed by Woestmann, was an illegal breach of contract, calling van Aubel and von Falkenhausen’s complicity both “immoral” and “especially reprehensible.”

The financials- should you really care at this point?

Envion raised more than $100 mln during its ICO in from Dec. 15, 2017 to Jan. 17, 2018. The token entered public trading at $1.09 in February 2018 and dropped like a rock to $0.07. While the company had a kind-of-novel idea, it was never really that well thought out and never had a chance. The big scam and fraudulent creation and transfer of tokens to new majority holders don’t give much of a chance to do anything else but add another fraudulent soap story to the crypto storybook of scams and major failures.

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Question of the Day: Can Stablecoins Accelerate Cryptocurrency Adoption?

  • Yuri Molchan
    ⭐ Features

    Stablecoins show hardly any volatility compared to Bitcoin and altcoins, many are hoping that they will be able to bridge new crypto economy and regular fiat money

Question of the Day: Can Stablecoins Accelerate Cryptocurrency Adoption?
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Bitcoin, the father cryptocurrency, emerged in hope that it will remove all intermediaries in electronic commerce that cut off their share of payments. BTC was perceived as a P2P way to replace fiat cash in an electronic format, which would enable one party to pay another without any financial institution or payment platform which would demand its share of a transaction as a reward for its services.

What is wrong with Bitcoin

For quite a while Bitcoin was performing the way the crypto community expected. But the situation changed later – BTC rate became weaker, thus bringing down its financial and economic reliability, when it gets to be used as a regular means of payment.

You cannot have a currency that would cost like a British castle today, a gram of gold – tomorrow and a pack of French fries the day after.

At that point practical fintech minds came up with an idea of creating something which would become a breakthrough in the universe of crypto – a so-called stablecoin.

Will stablecoins solve the volatility problem?

Technically, stablecoins are protected from the volatility roller-coaster that Bitcoin and other cryptos love to ride. They are programmed to keep their prices stable and investors now are largely attracted to this new type of digital assets.

Stablecoin does not show any volatility in its monetary value, since it has a fixed connection to an asset it is pegged to. The major goal of using stablecoins is taking the best from decentralized crypto coins and combining it with a constant value. Thanks to it, stablecoins can be used as a reliable means of trade.

Asset-pegged stablecoins

Asset-backed ones get their value from an asset as can be understood from the name. An asset provides the necessary value to a coin, as well as the necessary legitimacy.

A great example of an asset-pegged stablecoin is Tether (USDT). In spite of a series of scandals at the end of last year, it remains the most popular stablecoin in the crypto market.

Recently, it has partnered with the Tron Foundation to launch a Tron-based stablecoin.

Other examples are TrueUSD (TUSD), USD Coin (USDC), the Gemini Dollar (GUSD), and the Paxos Standard (PAX). They are all pegged to the USD.

Crypto-backed stablecoins

Some digital coins work in a similar way to fiat-backed ones, however, they are pegged to collateral crypto. That means that crypto assets that ensure the value of such stablecoins are stored in a wallet similar to escrow.

A good example of a crypto-pegged token is Maker, which is ranked 16 on CMC.

Algorithmic stablecoins

Even though, stablecoin can be interesting at first thought but the way they are built goes against the principle of decentralization that crypto coins have as a foundation. Thus, many crypto fans and evangelists are positive that stablecoins must be linked towards not a centralized asset but a computer algorithm which takes value from a balance between supply and demand.

Basis is now considered the most promising algorithmic stablecoin of all.

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Can stablecoin ensure smooth future for the crypto industry?

The primary goal of all crypto assets was and remains to come up with virtual asset that would be liquid enough and not vulnerable to market volatility. From this point of view, stablecoins are a dream of all crypto fans and evangelists of a decentralized economy.

Apart from the potential to conduct crypto transactions smoothly, experts believe it can bridge the two worlds – fiat and crypto, bringing them a mutually beneficial coexistence. However, that may take time.

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