Investigating the Top 50 Cryptocurrencies, Part 3/50, Veritas
Veritas is a digital token offering information analysis and decentralized trading, but there are red flags. I am pretty skeptical of the whole thing - even if it’s not as bad as FirstCoin.
This token does not have a great reputation so far. There are a few alarming facts (example: 98% of the VERI tokens are owned by one person) which, when combined with the token’s generally vague and confusing functionality, make me think this is a token to avoid.
For more info about what makes me worry about Veritaseum, keep reading.
About This Series + Disclaimer
This post is part of a new series where I investigate each of the top 50 coins by marketcap (based on coinmarketcap.com's rankings on October 11, 2017). My goal is to help steem’s userbase become the most knowledgable blockchain community in the world.
Disclaimer: I am not an investment expert and will not be providing investment advice. I will teach you about the top 50 coins, and you can do what you want with that info.
What is Veritas?
Veritas is an ERC-20 token which launched via ICO and claims to offer an advanced form of analysis for other digital tokens. It also will supposedly offer decentralized asset trading and issuance, possibly similarly to Bitshares. There is very little information about these services on the Veritaseum company website,
The only marketplace to buy and sell VERI tokens at right now is https://etherdelta.com, an obscure decentralized exchange.
My immediate search for info did not look good.. I found several articles about VERI being a bad token.
Article 1: https://medium.com/@EthereumRussian/veritaseum-is-a-scam-c6e05fb1e4eb
Article 2: https://www.coindesk.com/veritaseum-founder-claims-8-million-ico-token-stolen/
Article 3: https://steemit.com/money/@financialcritic/analysis-of-the-veritaseum-scam
To be fair, there was some good coverage as well:
Article 4: https://cointelegraph.com/news/crown-jewels-for-free-veritaseum-goes-ico
To be honest, the above article sounds a lot like a fairy tale to me. The author seems to accept all of founder Reggie Middleton’s claims without any verification - leading to the absurd idea that “this token has no competitors.”
IDK. Let’s look at what the website has to say. There are a few paragraphs throughout the blog which raise red flags for me.
Info From the Veritaseum Website
from http://veritas.veritaseum.com/index.php/26-veritaseum-faq-frequently-asked-questions
Quote 1: ”Veritas is not an investment, it is software. We cannot stop others from speculating on VERI.”
This doesn’t make much sense to me. They don't have any great software or website right now. VERI seems a lot like a speculative token so far.
Quote 2: ”Veritaseum’s products are not dependent on any blockchain because it can be moved to different blockchains. This being said, it will take some engineering effort to port from, and between blockchains. We feel that most new blockchains will be written in such a fashion as to be backwards-compatible with Ethereum applications.”
What? The products are not dependent on any blockchain?
When you issue a token, you are committed to the blockchain. You can’t just switch to a new protocol - that’s equivalent to changing all the rules in the middle of the game.
There are theoretical ways to switch blockchains - an exclusive airdrop of new tokens with 100% exact distribution based on the token holdings on the previous chain, I think, would work - but even in the best case, it will diminish confidence in the token significantly.
Quote 3: ”Veritaseum was already planning to release public financial reports. We believe we are a software based consultancy that has not issued unregistered securities, but if forced to comply with SEC regulation as something other than a software vendor, we don’t believe we will have a problem in doing so. Please be aware that we are not regulatory specialists nor securities attorneys, hence this is simply our layman’s opinion.”
Utterly unprofessional. “We don’t believe we will have a problem in doing so.” is tantamount to saying “We can’t promise you anything!”
Some More Context on What Veritaseum Does
Check this out, starting at 3:10 for about 2 minutes. This YouTuber discusses the purpose of the VERI token:
This explanation of Veritaseum, which is embedded into the company’s blog, is a good example of how the whole system sounds reasonable, but doesn’t make a lot of sense:
I went ahead and transcribed about 90 seconds of audio from that link to show you how it doesn’t offer much more than an elevator pitch, a vague idea without sufficient details. Check this out - it’s a word-for-word transcription minus “ahs” and “ums”.
”Veritseum used to work for bitcoin, you used this vertias token that they had the ICO for to feed it as a form of transaction fee you could look at it - into an autonomous robot that is constantly learning about different assets, different cryptourrencies, different building valuations over time,"
"Like how much this property’s gonna be worth, or the profit flows through a business, so you can literally feed this token into this A.I. - a rudimentary AI being built through smart contracts on ethereum that is learning through not just input in the form of it automatically knowing for valuations for different cryptocurrencies, looking at what the stats are in real time through different feeds that are fed to it, but also because veritiseum is a company that has employed at least 3 analysts right now who are combing for information deep research information,"
"Publications are created about different projects so theres a free project that they already released about gnosis, the prediction market, I’ve spoken about before, and the possible profit potential - let’s say you want to know if its good to invest in this project right - so you would feed this veritseum token to the AI or to the analysts team, you can give it to the analysts over at veritseum, and get a bunch of information or reports about this company, about whether to invest in it or not."
"The token also gives you access to this kind of platform, where you can get on pretty much anything.”
What is he actually saying here? It boils down to this:
Point 1: Vertaseum was previously built to work on the bitcoin network, but then launched as an ERC-20 token via ICO.
Point 2: The purpose of the token is to get analysis of other tokens. You can pay for these analyses using the token itself, and you will receive your info either via A.I. or via the “Veritaseum Team” (which appears to be a single centralized company), your choice.
Point 3: This information can be used to predict whether or not an investment is worth buying.
That’s a lot of words and roundabout logic to explain three simple points. The Veritaseum website offers significantly worse and denser word salad, such as on this “explanation” page: http://veritas.veritaseum.com/index.php/27-veritaseum-autonomous-distributed-interactive-research-veadir
This is as opaque and fancy as it can be, but not in a reasonable way. It’s the exact opposite of, for example, a Vtalik Buterin essay. Vtalik tries to discuss complex ideas as simply as possible. The Vertiaseum page seems to make simple ideas as convoluted as possible.
The Team
The Veritaseum company is made up of three people:
Reggie Middleton, owner of http://boombustblog.com/ and founder of Veritaseum.
Reggie Middleton // source: twitter.com
He holds 98% of all issued tokens so far. Uhhh, what? red flag, to say the least.
(sources:
https://cryptohydra.com/crypto-reports/veritaseum-veri/
https://medium.com/@EthereumRussian/veritaseum-is-a-scam-c6e05fb1e4eb)
Patryk Dworznik: *“Patryk is a Full Stack Developer and Engineer, developed the legacy Veritaseum Java client, adept at Bitcoin blockchain development, bitcoin script, Java, React, javascript, C++, Go and Solidity.”
Patryk Dworznik // source: twitter.com
Patryk’s LinkedIn page suggests that he worked at Nokia as a “Senior Software Engineer” for several years before joining Reggie’s company in 2014.
Manish Kapoor: ”Manish is a certified International Analyst and Forensic Accountant, served as Asst. Director & Manager with CRISIL/S&P, Price Waterhouse Coopers & Deloitte. Manish has worked with Reggie for 10 yrs in predicting the fall of Bear Stearns, Lehman Brothers, General Growth Properties and the European sovereign debt crisis.”
Manish Kapoor // source: linkedin.com
Manish’s LinkedIn page suggests that he has been working in the financial industry for about 15 years - it’s the most impressive, at a glance, of the three’s resumes.
Market History
source: coinmarketcap.com
This is a young token that is experiencing a slow drop in value over time. Not much to go off of yet regarding its future price, but I find it hard to believe it can stay in the top 50 for too long.
When I took my market snapshot for the top 50 list, it was #48 - now, four days later, it's #38. It's climbing in the short term. We'll see what happens...
Final Thoughts
Overall, Veritaseum seems like a vague, useless coin. It claims it will help people analyze other digital tokens to find profitable investments - but there is little supporting evidence for this claim.
Even less info exists about the fact that it will supposedly be used to issue smart assets for a decentralized exchange ala BitShares.
What we have here is a bunch of fancy words describing a futuristic idea, but with no proof that it will work. If it’s really true that the founder holds 98% of all existing VERI tokens, then I have no problem labeling this thing a shitcoin.
What Do You Think?
Do you have any experience with Veritaseum? Let me know about it in the comments.
So two out of 3 alt coins in the top 50 have red flags? It doesn’t look good. I appreciate its very small sample but just goes to show how many frauds there are. Most Alts don’t even bother to prebtend to offer any value. They just claim a slight tweak to the protocol and think that justifies multi million pound valuations. We need a crash to clear out
Yeah it's surprising that 2/3 so far are not good tokens by the looks of it. FirstCoin was a straight-up scam even more blatantly than this one.
Hopefully there will be some better tokens in the next few days...
Fingers crossed. Loving the reviews. Good initial investigation to target detail analysis. Keep up the good work.ed analysis. Keep up the good work.
Very detailed blog. Unfortunately given the previous hack and hardforks it has fallen out of love with many investors.
Thanks Steve. I doubt it can stay in the top 50 for much longer.
Loving this series. I hope you stick with it though it's a heck of a lot of coins to get through!
Thanks Luke! I am confident that I can keep the momentum up and do all 50.
So anyone that's code and computer savvy can dream up digital money? What makes the coins the owner is holding valuable? And how did they become valuable? This doesn't really seem much different than someone buying a press and printing their own cash.....
I guess they've sold enough tokens on the market to get a rough market cap based on the price VERI is selling at and the total number of tokens in circulation.
After this post, I now figure that the valuation can't hold for much longer. It can't be sustainable to have a token where 98% of the supply is owned by the founder.