Token launch of Nigerian cryptocurrency exchange raises eyebrows

By: Dickson Arinze

Token launch of Nigerian cryptocurrency exchange raises eyebrows

August 25, 2023 6:07 AM

This development comes after the corporation previously disclosed a security compromise that resulted in fund losses in May 2023.


An announcement regarding the launch of Patricia Token (PTK), the exchange's native token, was made by the Patricia team in Nigeria. The local bitcoin community is skeptical about the launch, rather than enthusiastic.


Native tokens are a sort of digital asset that can only be used on a certain blockchain network or trading platform. They are issued and generated entirely within the platform or exchange. Binance Coin (BNB), Ethereum Token (ETH), and Solana Token (SOL) are all examples of native tokens.


The company announced→ its plan to move its exchange activities to the Patricia Plus app in an official post on X (previously Twitter). Customers' existing Bitcoin (BTC) and naira balances will be replaced by the newly released native token, which the corporation claims is a stablecoin with a 1:1 peg to the United States dollar.

 


This follows the company's May 2023 announcement→ that a security compromise had caused losses to investor funds. Despite assurances that customers' monies were safe, the platform's users have been having trouble withdrawing their money since April.


Customers who have monies stuck on the site have been the subject of concern about the possibility of an exit scam following Patricia's revelation.


There are a few warning signs about Patricia's introduction of PTK, which have been brought to light in posts by members of the local crypto community. CoinMarketCap and CoinGecko, two of the most popular cryptocurrency databases, do not list the token. These services provide in-depth descriptions of tokens, including their true worth, number issued, contract address, and launching the blockchain.


PTK is not present on mainstream blockchains where native tokens can be launched on exchanges. For instance, the Ethereum blockchain is where you may get PYUSD, the stablecoin that PayPal just released.


Patricia announced in their X revealing that they would be converting unpaid bills to PTK without first receiving client approval. This has been done unilaterally, and it has caused some people to worry that they won't be able to trade their tokens for dollars or other cryptocurrencies like Bitcoin.


A loss of PTK's peg may leave clients who were unable to withdraw their funds stranded if a big number of customers suddenly decided to make withdrawals.