GXChain (GXS) Whitepaper Lacks ICO Details
GXChain (GXS) is a cryptocurrency that was founded by Minqiang Huang and released in 2017. It is forked from the Graphene blockchain and integrates some characteristics of Emercoin and Monero. There are 60 million GXS in circulation with a total supply of 100 million coins, indicating that the developers are holding onto 40 million coins. The details of the initial coin offering (ICO) and the premine being held by developers is not in the white paper and practically impossible to find, which is quite shady and discouraging for investors.
The developers can sell the premine at their discretion, which will suck money out of the pockets of every trader and investor who owns GXS. Daily trading volume of GXS is in excess of $10 million with a market cap of $175 million, despite the inherent risk of owning such a heavily developer held cryptocurrency. This trading activity is likely due to use of the GXChain platform, where the only accepted currency is GXS.
Background Checks on a Blockchain
The primary purpose of the GXChain project is to provide a blockchain-based platform for background checks. Background checks are a popular mechanism to screen people before hiring them for jobs, giving them loans, letting them rent an apartment, etc. So, this crypto-platform will have all sorts of personal credit and background data that can be bought anonymously in exchange for GXS.
A user simply submits a query including the identification of the person they are looking up and the data they want, and a data provider fills that request upon receiving payment. There will be a reputation system built directly into GXChain so that data being sold isn’t fake, but this system sounds inherently centralized and moderated, and will likely be imperfect. Moreover, this platform is aiming to prevent the sale of fake and fraudulent information, and they somewhat achieve this since reputable data providers can be cryptographically verified, but there is ultimately no way to guarantee that the data is truthful.
Potential for Abuse by Criminals
The biggest advantage of this platform is that users can do a background check on someone and remain completely anonymous, but this might be a bad thing since criminals will probably utilize this network to obtain personal data and commit financial fraud.
Notably, GXChain is the first blockchain-based background check provider, which is innovative and in-demand since users can buy personal data about someone else while remaining completely anonymous. This can be used for honest background checks, but is a double edged sword since criminals can use it to get the data they need for fraud. It is likely that GXChain will become an integral part of illegal activities on the dark web, which is probably why its currency GXS has such a high daily trading volume and market cap.
This is not advice. Advice should be accepted by your chosen legal counsel only and financial advice should come from a licensed or certified financial professional. As always – do your homework and make decisions based on your own education. Seek information and look into projects before adding to or diversifying your portfolios.