The 2-year-old cryptocurrency project offers 38% staking rewards. Is the project legit or a scam?
The HEX token is based on the Ethereum blockchain. Their website states that they are the first blockchain certificate of deposit. Those who stake HEX tokens receive an average of 38% returns. The figure is lucrative because most US banks don’t pay more than 2% annual interest.
Who is the founder?
The HEX was founded by Richard Schueler, who adopted the stage name Richard Heart. One of the steps to fundamentally analyze any project in Web3 is to check the history of its founder.
Richard’s mail records show that he used to give a course on how to spam people. In fact, he was accused of invoking Washington State’s anti-spam law.
His Twitter organic reads that he owns the most expensive Rolex, the fastest Ferrari in the world and brags even more about his lifestyle. He has flexed his wealth repeatedly on social media. When asked why he was flexing his wealth, he said it was for opinions and commitment.
HEX’s aggressive marketing focused on price gains.
from Twitter Last name from official account reads prize win and high stake rewards. There aren’t many genuine projects that focus on price gains as much as HEX. Typically, projects care about creating the best services for their community. Their social media handles aren’t marketing the token’s price increase, let alone shouting it through their handle’s name.
They also launched a country #HEXBoughtThis on social media, where shillers or early investors flex their wealth bought from HEX earnings.
It is one of the most aggressively marketed crypto projects. The project was advertised in newspapers, magazines, billboards and airports. All of these campaigns aim to show how much the price of the token has risen. The approach is the same as for any get rich quick program, to meet the greed of ordinary people. A Twitter user job that HEX used customer records from the Ledger hack and mailed marketing materials to addresses obtained from there. How many Web3 projects do at par marketing with HEX?
The website claims investors will create “life-changing wealth.” Authentic projects with solid products don’t focus primarily on increasing their market price for marketing purposes. The Bitcoin and Ethereum website does not discuss price fluctuations or the creation of “life-changing wealth” because they serve a purpose. Money-making investors are a by-product of the larger purpose of these projects.
HEX buyers are incentivized to lock in their capital for a certain period. There is a hefty penalty if someone unlocks them before the lock period ends. This effectively reduces the supply of tokens in the market and the demand is introduced through FOMO with the aggressive marketing campaign.
The website, at the time of writing, shows staking rewards of 38%. Who receives the staking reward?
In the proof-of-stake consensus mechanism, validators deposit a certain amount on the smart contract as collateral to ensure the security of the blockchain. They are rewarded for their uptime and reduced for being idle for a long time.
While there is no such thing with HEX, stakers do not stake their HEX to secure the blockchain or validate transactions. The sole purpose of staking HEX is to reduce the supply, which puts upward pressure on the price of HEX.
Whether or not HEX is a scam is a pretty hot topic of debate within the Twitter community. In addition to criticism, the project has attracted die-hard supporters. Notable industry leaders believe that HEX is a scam intended to zero.
HEX reached an all-time high in September 2021 at 0.51. It is down about 94% from all-time highs. Most crypto scam schemes do not survive the test of bear markets. Will HEX survive the current bear market or go to zero? Maybe only time can answer that.
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