Verge (XVG) Team Asks for More Money. What's Going On?
Verge (XVG) has been one of the more controversial cryptocurrency projects of late. While there are some really strong supporters in the community, there are an equally large number of sceptics who rail against the project.
Now it seems as if the privacy conscious crypto coin is being true to form. They have announced a fundraising effort in order collect coins for a "potential partnership" that they would like to conclude. This fundraiser has a target of 75 million XVG and has currently raised 10.7 million.
Perhaps the more controversial part of the announcement is that the team require the raised funds in order to release the news of the potential partnership. Why would they require the funds to make the announcement? What happens if they do not reach their target?
Let's take a look…
Please Subscribers, Can We have Some More?
The Verge team made the announcement on Twitter yesterday in a post labelled as an "IMPORTANT UPDATE". They said that some global organisation with a "vast network" may form a strategic business alliance with Verge. Below is the tweet in question
There were many that replied to this post with confusion as to the need for a donation and why it should impact on the partnership. Some wondered whether the "potential partnership" was just a way to incentivise donations by supporters.
Verge followed up with a tweet that explained that the donation would be needed in order to fund the integration on the platform. Hence, they made it clear that the partnership perhaps was contingent on this particular integration.
There was a great deal of speculation online about who the particular partner could be. Some thought it could be a unique exchange listing whereas others quite outlandishly thought an Amazon or Microsoft partnership was a possibility.
Whether this could have the impact of encouraging donations is not really clear. It could insensitive XVG holders to donate in the expectation of a rally in price and an increase in their holdings. However, on the flip side, if you were one of those who donated and they ended up not getting the partnership, you will have donated for nothing.
XVG Price Reacts
The immediate reaction of the price was a rally (below chart) which is probably on the back of the announcement. This has become too common in cryptocurrency these days that an announcement of an announcement is used to increase the price of a coin.
XVG Price with Rally. Source: coinmarketcap.com
In fact, these were similar tactics that were used at other cryptocurrencies such as Tron. The founder of Tron also decided to dial back the announcement hype. In the case of the Verge tweet, the partnership is not even confirmed so it is even more deceptive.
If the Verge team manages to raise the funds required then XVG holders should also take into account the impact a sale of 75 million XVG could have on the market. Although total XVG supply is quite large, a sale of 75m XVG at once could impact the price and drive it lower.
If this were an isolated incident then many could have given this fundraiser attempt the benefit of doubt. However, they have had a number of other fundraisers over the past year with the most recent one back in October in order to do some testing on Atomic swaps.
Fundraising was not the only controversy that Verge was caught up in.
For example, the community was in a state of disarray last year as failed deliveries and other FUD flooded the airwaves. Verge was also trying to recover from the fallout it was having with John McAfee over his promotional tweets.
Despite this, stalwart Verge supporters are standing by and are hoping that the partnership announcement does indeed take place. However, as the old adage goes:
Fool me once, shame on you. Fool me twice, shame on me.
Featured Image via Fotolia
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.