The case of Banx & C-CEX
Steem Cash is a new project that caught my attention because one of the individuals behind it is Mark Lyford ( @marklyford). His earlier project was Banx, which many have claimed to be a scam and I tend to agree with them.
Some of the stuff is documented quite well in these articles:
- Ponzi Accusations Fly As BanxShares Is Set To Be Removed From CoinMarketCap Rankings
- Banx Three Months Later: No BitShares Integration, Less than 1% Sold, Network Is Down
- Mark Lyford Opens Banx Sales, Quickly Becomes Worthless
Lyford and his business partner Michael Taggart ( @michaelx, @murderistic) have claimed several times (quite aggressively) that those articles are full of lies. But as far as I have dug into this case, I haven't really found any evidence that proves that Ian DeMartino, the writer of the articles, has lied. Lyford and Taggart have implied that the evidence is somewhere in the internet but they haven't provided me any links.
When I was looking for more information about Lyford, I found his chat logs with cryptoexchange C-CEX. Of course I had to read it all because chat logs are many times very good way of seeing how people really act and think. Chatting is usually quite spontaneous so people don't think much what they write and don't use much time to tune their message.
Chat logs: with Pride, "the coin hunter" and with rest of the team.
Things started out when Pride from C-CEX contacted Lyford and wanted to list Banx Shares in their exchange. C-CEX agreed to do a customized ICO (initial coin offering). The customization in this case was that Banx Shares were put on the exchange, but Lyford was the only seller (if I've understood correctly, in normal ICOs coins aren't moving in the exchange until the ICO is over). This way he could make sure that the price was what he wanted it to be.
But eventually problems arose because Lyford didn't do any actual contract with C-CEX, which caused some misunderstandings. But instead of finding a good way (for everybody) to exit the situation, he behaved quite childishly and was very intimidating. On the other hand, C-CEX guys kept it cool almost all the time.
Lyford's goal was to make successful ICO, but he made a mistake and released the wallet during it. Because of that, C-CEX wanted to end the ICO phase in their exchange and let customers trade freely. After all, why not? If the wallet is publicly available and everybody was already using it, any exchange could start to use it too and let their users freely trade Banx Shares. It would not make any sense to not let trading happen also in C-CEX. Lyford should have released the wallet only after when the ICO had ended. So C-CEX decided to end the ICO phase in their exchange and let users trade freely.
Lyford was clearly only interested in how much money he can make. He wasn't happy that other people could sell Banx Shares cheaper than he was selling. He didn't show any interest for C-CEX's side of the story: it would be very bad move for them to delist a coin that is actively traded. Customers wouldn't be happy about that. C-CEX asked several times for a reason so that they could explain removal of the coin for their customers, but Mark didn't give any. This was because his goal was to manipulate the price to stay high. He didn't show any signs of caring about the customers, which were, of course, also owners of Banx Shares.
Reading through all that made my impression of Lyford stronger: he is a really bad business partner. I recommend everybody to stay away from him. Apparently he got criticized on the trollbox and didn't like it (surprise, surprise!). Demand for the BanxShares was also quite low, he managed to sell only very little which jeopardized the ICO.
Lyford was also very clear that he wanted C-CEX to manipulate the Banx Shares price by setting minimum prices for sell orders so that the price would stay up on Coinmarketcap.com. Reason for that was that he was trying to raise money outside of cryptoscene. He needed high rank in CMC to show other investors that Banx was already very successful. And that is the thing that makes Lyford a scammer in this case. His intention was to artificially manipulate the price and use that to deceive investors to give him more money. In my opinion that is highly unethical. When a new company is raising money, they should be very open about their real situation and not intentionally lie to potential investors that they are already succeeding. If investors don't know all relevant information, they can't do rational decisions.
The end was even more absurd (although all events are not clear to me, Lyford had of course heavily edited the Bitcointalk thread about Banx). Apparently some old wallet allowed mining and of course users did mine. Then they sold those coins in C-CEX. Lyford claimed that this was some kind of exploit and changed the blockchain and wallet so that it didn't work anymore with old wallets, including the one that C-CEX was using. So customers in C-CEX who had coins in there lost them because they couldn't make any transfers anymore. Lyford really didn't give a shit about investors, he just wanted to make sure that he'll get as much money as possible.
It also showed very clearly that Lyford had no idea how blockchains and wallets work. How the hell that kind of person could have been successful with all the megalomaniac plans that Banx had (exchange, ATMs, mining operations, physical coin issuing, casino, trading bot, etc)?
[20/11/2014, 12:37:36] Mark Lyford: this is happening in 8 days: http://banxcapital.s3.amazonaws.com/BANX_CAPITAL_wallet_update_announcement.pdf
[20/11/2014, 12:37:43] Mark Lyford: ill leave it to you to tell your customers,
[20/11/2014, 12:37:56] Mark Lyford: if any of your legitimate customers have an issue they are only too welcome to contact me
[20/11/2014, 12:39:18] C-CEX.com: Very good. I just don't recommend to call the fact old wallet supports mining as "exploit" - it is really funny and unprofessional
[20/11/2014, 12:39:59] Mark Lyford: whatever mate, don't talk to me about unprofessional ehh
[20/11/2014, 12:40:35] C-CEX.com: Are You professional in cryptocoin technology? You know all the things how it works?
[20/11/2014, 12:41:03] C-CEX.com: It's like when auto delaer may call "exploit" that his customer still driving old car :)
[20/11/2014, 12:41:14] Mark Lyford: my guys are, I don't need to know everything Im the marketing entrepreneur , I know how to deal with people. thats all I need . I don't change deals half way through a deal...
[20/11/2014, 12:45:01] Mark Lyford: i think you knew people were doing this and dumping illegal shares on your exchange.
[20/11/2014, 12:46:22] C-CEX.com: First You need to state what is "illegal shares"
[20/11/2014, 12:46:42] Mark Lyford: shares that should have been mined over our 6 mill shares.
[20/11/2014, 12:46:45] C-CEX.com: Post it somewhere and then maybe we will have a chance to investigate further
[20/11/2014, 12:47:07] C-CEX.com: Why are they illegal if they could be mined using Your wallet?
[20/11/2014, 12:47:12] Mark Lyford: listen. I'm done with this, I'm too busy to be dealing with this shit any more.
After that incident it should have been clear that Banx had failed. There weren't enough demand for Banx Shares so the funding would be insufficient to carry out all the plans that Banx had promised to it's investors. Only reasonable thing to do would've been to stop the project and return the money. But instead of stopping it, Lyford continued to push it forward. We now know the result: more new investors were deceived to buy shares which are worthless today (Banx was finally closed in April 21 2016).
Lyford didn't care about his investors (he didn't want old investors to be able to trade freely and he wanted to deceive new investors to pay more than market price) and he didn't care his business partners (his behavior was very intimidating and manipulative against C-CEX, he clearly wasn't interested in finding a win-win solutions). Of course different people have different views on what is ethical business and what is not, but in my view price manipulation with intention to deceive investors is very much in the category of unethical business.
Also it's very bad personality trait for a businessman to never admit that he has made mistakes and accuse everybody else for them even it's obvious that he made them himself. Later Lyford has stated that mistakes were made in Banx project, but in this particular case with C-CEX he was shamelessly and aggressively claiming that he hadn't done anything wrong.
So TL:DR Don't use Steem Cash
Because he failed at a previous business? Ever make a mistake? I hope people don't beat you up over it for the rest of your life.
Well, the mistakes were quite bad and Lyford doesn't seem to think that he was responsible for them. In this case he tried to blame everybody else. If he hasn't learned anything from his past mistakes, why we should trust him now?
And these weren't only just some normal business mistakes that everybody makes. He tried to intentionally deceive investors by manipulating the market price. That is highly unethical behavior, don't you think?
I have admitted many times I made mistakes in trying to do the right thing get Banx going. many times.
and again I have never deceived ANY investors.
Again, I'm wasting my time because you have clearly made your mind up about the situation based on the information you choose to see or believe.
As an investor I would disagree with this. You have told many lies and deceived so many people. People have converted to the new token but only because they had no other option and hope you have finally gone straight. I hope you are really gonna have a go at running a legitimate business so we can see some return from our investments. I doubt you have done a days honest work in your life that's why you held our investments with such a low regard and pissed them away like Monopoly money. People's hard earned money and pension funds from doing real work not sat behind a computer telling lies to trick people into parting with their money.
You should present some evidence that your business was legitimate. Now I have only your word, which I don't really believe much.
All the evidence that I have seen so far, like the chatlogs, show that your behavior was very unethical.
Mark, Banx was nothing more than your own private piggy bank, it still is actually, what about the fake monthly profit statements you created & posted to investors accounts?, do you think that that is a legally sound action?, how did you make the money to generate profits?Banx wasn't trading, let me guess, your answer will be
"Again, I'm wasting my time because you have clearly made your mind up about the situation based on the information you choose to see or believe"
Yes I have made many mistakes, but I admit to them. I also have never made mistakes with other peoples money and continued to take peoples there hard earned funds even when I knew the game was up.
how to end up with $1m in any given industry?
start with $5m & employ or partner with Mark Lyford, the kiss of death
Some lies by Lyford:
C-CEX wasn't involved in any kind of hack. Lyford wanted to stop trading there because he couldn't manipulate the price. Chat logs prove this very clearly.
Lyford sold Banx Shares in C-CEX himself. That is public selling. Chatlogs prove also this without any doubt.
Apparently Lyford was knowingly breaking the law when he sold Banx Shares in C-CEX. It wasn't any unfortunate business mistake. In this video (recorded 18th July 2014) he tells his investors that public selling is not permitted.
Shares were sold on C-CEX from October to November in 2014. It was Lyford who did it, chatlogs prove it.
@marklyford, do you want to comment this? Did you broke the law when you sold shares in C-CEX?
You fail to mention that we offered to convert all Banx from CCEX users to the new forked version of Banx and most people did convert them.. Quite an important thing to omit don't you think?
You also fail to mention that I have repeatedly admitted mistakes were made with Banx. I will however say NO mistakes were made in the dealings with CCEX. They went back on their word and original deal and therefore action was taken accordingly.
After I've read so many lies from you, I'm skeptical quite about this. Do you have any evidence? How many shares existed and how many of those were transferred to the new chain?
According to Bitcointalk, you have been acting very hostile against many Banx Shares owners. I would be surprised if you have transferred all shares, including those that you called "illegal". AFAIK they were perfectly legitimately mined.
You gave them very bad deal and didn't explain why they should have kept that. And you changed Banx project many times without asking anything from investors (here are some examples). Why it should be that only you can change deals but nobody else can? I'm quite sure that if you had been in C-CEX's position, you would have changed the deal too. And the "deal" was quite unclear, you didn't have any written contracts, and you didn't even make the "deal" with the owner.
Your mistake was to publish the wallet before ICO was ended. If you publish a wallet, then anybody can use it freely (including exchanges). That's the game in cryptoworld. You clearly didn't have any idea what you were doing.
But let's not forget that your reason for all this was to deceive potential investors. That is the worst part of the story and makes you a scammer.
nothing I say or do will be good enough for you, you have made that perfectly clear. If you have done your research as you say you have you will see all people were offered the new Banx on the new blockchain.
I have NEVER deceived potential investors EVER.
This is my final reply to you because I am clearly wasting my time.
"I have NEVER deceived potential investors EVER."
Mark you are either very think skinned or delusional. You manipulated the price of BANX from day one. Thus deceiving investors they were onto a winner! Their is noway I would have invested within your outfit if I had known the real truth behind BANX. Unfortunately no investor will ever know the real truth behind BANX to this day you maintain your innocence. After a quick search on Google it is clear to any outsider to see the real truth behind BANX.
http://coinjournal.net/mark-lyford-opens-banx-sales-quickly-becomes-worthless/
https://bitcointalk.org/index.php?topic=1181883.0
I would strongly recommend any potential investor wishing to purchase any product from M. Lyford to do there homework first.
Yes, I have done my research and I'll be doing even more. I have seen that you promised that shareholders can transfer their shares to the new system. But the real question is: did you actually do that?
You talk much but many times your words and actions are very different. You say one thing but do something else. That's why I'd like to see some evidence that backs your words.
Maybe you should read your chatlogs to refresh you memory. They prove without a doubt that your intention was price manipulation so that you could sell shares with higher price.
Mark did let investors convert Banx over onto Bitshares. This only occurred when Banx shares had become worthless. He then made a promise to convert all investors Banx shares into his new venture Entrapment/Entrepreneur Action. http://entrepreneuraction.com/
Entrepreneur Action has still not been officially launched and the countdown clock has been reset at least five times. Now Mark has moved onto yet another venture Steemit. I would strongly advise anybody not to invest a single penny into anything that Mark Lyford puts his name to.
yes you did Mark, you deceived everyone, how about doubling the original share issue from 6m to 12m?,( after claiming that the original share offer would never be increased, was that a lie or a 6m mistake?) you maintained the share price when it should have been halved, total misrepresentation of the value of the company, have you considered the tax issue of having doubled the claimed value of your company?, not content with this you then went 10 fold to 120m just like that with a click of your finger & a shot of Jack Daniels your claim was "my company is worth 120m", how did the value of you company legitimately go from 6m to 120m within a year with zero trade ever having been accomplished............and with zero accounts?
how do you do it?
Lyford just said this "This is my final reply to you because I am clearly wasting my time."
this is all you will need to read, he gets to this point when his answers are shown to be empty lies, he has no truth to give, no one believes him so he takes his bat & ball home & now he will sulk, the next claim will be that we all destroyed his business because we are bullies & trolls, the world wasn't ready for Mark Lyford,
Ha Ha Mark, perfect "This is my final reply to you because I am clearly wasting my time"
no one believes you so you sulk , I have learned that this is your go to statement when you know that no one believes the nonsense that's coming out of your mouth, for once just tell the truth, get it over with
Good investigative work and write-up. Thank you. I have wanted to think the best of both of these guys. But even if Mark had an honest idea to make a business, it's also true that people keep losing their money each time. Plus, it doesn't sound like he handles it well.
And Michael? I don't know. Maybe he just picked the wrong partner or projects, but I thought the recent e-mail those guys sent out (someone posted it separately here on Steemit) was unnecessarily pushy and borderline misleading. I don't know that anything Michael has worked on in crypto has really come through the last few years, but maybe he's had some bad luck also. Stan in BitShares still has a high opinion of him and that means something to me.
Would I invest in any of their projects? Probably not.
Only one of my projects didn't turn out. And everyone was refunded, weren't they @onceuponatime ?
RE: email - did you read how the guy made a mistake and actually signed up for it? Misleading? The only thing misleading is the author that posted it.
Or how the author was blackmailing other users for SD?
The fact is people will not let Mark be - he screwed up previously, he didn't run and is still trying to make good. Doesn't sound like a bad guy to me.
Michael, Banx was not a failed startup, it was a scam from day one, conjured up in a prison cell as a means to repay some people that were important to him ( not Banx investors) he needed to make his parents whole, he borrowed 150k on their home to fund a business (he failed of course) & tried to repay the funds by growing marijuana but he failed at that too, there is nothing, absolutely nothing legitimate about the Banx operation ,it was a ponzi scheme ,illegal by definition, one day it & he will be investigated and you say " Doesn't sound like a bad guy to me."..you either have no clue who you're dealing with or you have rose tinted glasses
I trust very few crypto currency this days, the one with good projects timelines and good team!!
Zero transparency! Price manipulation with constant boasting that said price was going up "Now's the time" Paying dividends with investors money. The list goes on and on.
correct, new investors cash paid existing investors profits ( for a while at least they Lyford began paying out with worthless Banx shares)
in other words it is a classic ponzi scheme nothing more & nothing less
Just don't buy anything on C-cex, you should be safe from there on. I too have been fooled in that site, trust anything that isn't on the best exchanges. there are probably reasons for it
There is another Bitcointalk thread that I have missed: https://bitcointalk.org/index.php?topic=1181883.0
Reading it now, interesting stuff. Mark really doesn't give a shit about owners of Banx Shares.
I don't give a shit? Most people who are faced with a failed tech startup would close the doors and walk away. Instead I offered this to each and every Banx holder:
Banx Update 27th April 2016 - https://entrepreneurinternational.clickfunnels.com/optin8894733
Banx Conversion Tutorial - https://entrepreneurinternational.clickfunnels.com/tutorial
So to confirm I offered to convert Banx to a new Bitshares asset. That ENTREPRENEUR asset will pay out profits of all my business moving forward (which includes Steem Cash)
So it that not giving a shit about Banx holders? I don't think so.
Intention is everything, ethics are everything to me.
Try being accused of scamming people, when all you have done is try to get an ambitious business up and running which after as much hard work as possible didn't work.
You will find genuine investors like @kevinyoung and @menta who are REAL investors of Banx who will tell you despite currently being down on their Banx investments believe in me and more importantly believe I am no scammer.
I will leave it at that for people to make up their own minds.
Correct, you really don't. I see that very clearly when I read the Bitcointalk thread.
How do you explain that your intention in C-CEX case was to manipulate market price for Banx Shares? It doesn't seem very ethical to me.
the price has a minimum set because we needed to raise a minimum amount of money to launch the company. It's pretty easy to understand surely.
– "Mister, why did you rape that woman?"
– "Well, I just wanted to have sex. I'm sure you understand, there was nothing unethical about that because it is the only way I can have sex!"
If price manipulation is the only way to raise money, your business doesn't deserve any investments. It's pretty easy to understand surely.
If you had really wanted to do that legitimately, you could have done normal ICO where the price is completely set by you and no coins/shares will move until ICO is over. Why didn't you choose to do that?
anyone that invested into Banx is a real investor, not just the ones that want to agree with you & not challenge you, I have replied to Michael's post with some serious issues for you to explain but you won't, you have no answers because as already proven your answers are lies & they do not hold water & they raise more questions, as you well know after dealing with me, this continues until you become depressed or explode and then you take your bat & ball home & block that channel of communication, you're simply a scammer, a crook & a cry baby,I do wish that you would get real & sort things out, EA is already dead, it never had a chance because it was nonsense,perhaps you will repay the 750k from steem cash?, we'll see
thanks for the great article
The Truth About Mark Lyford and Banx >> https://steemit.com/introduceyourself/@marklyford/the-truth-about-mark-lyford-and-banx