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Eye-opening article on the situation around Karatbars
Despite being in the list of top 100 cryptocurrencies and arguably one of the most innovative blockchain ecosystem, Karatbars has been subject to more than its fair share of attacks.
Karatbars was initially founded back in 2011 by Senator Harald Seiz. As an early pioneer in the industry, Seiz recognized a strong need to bridge the cryptocurrency and traditional financial industries, while making gold much more accessible as both a store of value and payment method.
Since then, Karatbars has gone on to release a plethora of products that have achieved international success, including a gold-linked coin — attracting well over 750,000 customers in close to 150 countries in the process.
However, a whole lot of negative press has been published across several media outlets regarding Karatbars, spreading misinformation, outright lies, and other content designed with the sole purpose of damaging the brand.
Who might prepare such a smear campaign? In an industry where it is possible to achieve so much with almost no trail, it genuinely could be almost anybody. However, as always, the most likely candidates are scorned ex-business partners, major competitors, and extortionists. Karatbars International recently released a detailed statement on who they suspect to be behind the attacks.
On October 4, 2019, an article that is claiming, among other things, that Karatbars is being investigated by Florida regulators, has surfaced on CoinDesk. Moreover, the author of the article in question goes on to state that Karatbars did not respond to CoinDesk’s requests for comment, adding that “we will update the article if we hear back.”
However, Karatbars never received any such requests and, thus, was not able to respond to the accusations before the article was published. Consequently, no statement from Karatbars could have been included in the article, even if the author would have wanted to include one. However, the author deliberately decided to include that sentence anyway.
A closer look
First off, the article claims that Karatbars is being investigated by Florida regulators. However, we are not aware of any such investigation taking place, and we do not know where the author got that information from.
“[…]neither Karat Coin nor Karatbars International are under investigation of the Office of Financial Regulation and there are no judgments pending or issued against either of the two entities,”
Said Anna Krimshtein, who is the head of Karatbars’ legal department in Florida, in a recent letter to CoinDesk.
Further, the article mentions that Quebec’s Financial Markets Regulator issued a warning for investors in 2014. And there was indeed a legal dispute that was going on in Canada from 2014 to 2016. What the author seemingly forgot to add is the fact that this dispute ended in favor of Karatbars, which is still very successful in Canada. A transcript of the court process is available here.
Another major point that gets brought up is our gold mine in Madagascar. The author claims that this mine is not real. However, the documents regarding Karat’s gold mine are completely transparent and available on Karat’s website.
Karat insists on an increased amount of the regulations
The legal framework surrounding the cryptocurrency industry can be described as sporadic at best. Most countries have placed a major focus on regulating cryptocurrencies themselves, while completely ignoring businesses that are built around cryptocurrencies.
Similarly, by increasing transparency in the industry, smaller startups, entrepreneurs, and non-crypto companies will be more inclined to get a foothold in one of the world’s fastest-growing industries.
Recently, Harald Seiz, Karatbars CEO, commented:
“We assume that a former collaborator of ours is behind this malicious attack on our reputation. Unfortunately, the lack of regulators in the market provides an ideal environment for those dealing with illegal and morally questionable things.”
“Karatbars calls for more regulations for blockchain and cryptocurrency companies. This begins, for instance, with proper KYC mechanisms, as practiced by Karatbars’ dedicated KYC team,” Seiz said.
Overall, by regulating and bringing increased transparency to the industry, we make it more approachable to businesses of all sizes, while giving those who entered early an opportunity to set the standard and show that further regulations should be favorable, rather than restrictive.
A Look into the Future
Karatbars claims to be committed to a regulated crypto market. Blockchain technology is the future, and it will not be too long before the crypto market is finally properly regulated so that companies with great ideas or products no longer fall victim to anonymous, criminal acts.