Coss was involved in an EXIT SCAM in Early 2022! It froze $2m worth of users’ Funds and Hasn’t released them since.
Update 9/8/2022 — Coss was a very well-thought-out crypto project in the beginning. We don’t know for sure if it was intended to be a scam from the get-go, however, it ended up stealing users’ money and locking them out permanently.
The story goes something like this. Coss was a Singapore-based crypto exchange launched in 2017. While it had its fair share of problems, it managed to amass a healthy user base. But in early 2020, Coss suddenly put $2 million worth of user funds on hold and stated they will remain this way for a month as they make system-wide upgrades.
At the time the company assured its users that this wasn’t an exit-scam. They justified the sudden freeze by saying they didn’t want to trigger a mass exodus of funds. While they did well to reassure customers, it was all a hoax. Two years later, Coss still hasn’t released its users’ funds and has practically disappeared from the scene.
While it’s clear that Coss is definitely a scam, the exchange didn’t get enough naming and shaming. Although ex-users did write Reddit threads on how they were scammed, bigger names in the crypto industry haven’t been able to warn users against it. We feel there is a greater need for large names like CoinMarketCap and other crypto publications to explicitly label Coss as a scam so no other user falls into its trap.
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How to Recognize Scams Using the COSS Blueprint
As mentioned earlier, Coss was doing good as a project in the beginning. It was delivering on what it promised and it never looked like it would be vanishing with users’ money one day. We wrote a fair share about what Coss was and how it worked. Let’s use that as a blueprint so our readers are well-informed about fishy crypto projects that follow the same formula to scam investors.
COSS stands for Crypto-One-Stop-Solution. It represented a platform which encompassed all features of a digital economical system based on cryptocurrency. The COSS system consisted of website payments, seller tools, a marketplace, financial module, e-wallets, coin facilities and a mobile platform. The platform unified the most popular crypto and fiat currency services, e.g. exchanges, payrolls, wallets, acquisitions and transactions.
Here is an updated roadmap for COSS Exchange that was written about a time ago and they issued it after a downtime of 8 weeks. That is a lot!!! No professional crypto exchange that plans to stay in business would be down for such a long period. That should’ve alarmed users to take their funds out immediately when Coss came back on. However, those who still trusted it ended up facing an eternal downtime of the exchange.
Coss stands for (Crypto-One-Stop-Solution) Which seems to do pretty fine post-ICO in terms of trading volume (for their current state). But let’s take a view at the project first:
COSS decided to go a forked route and offers three services at once:
- A multi-crypto-wallet, where you can store all your cryptocurrency funds in a single location safely.
- An exchange for multiple cryptos ( currently BTC/ETH/VRS) and fiat (USD/EUR/SGD) currencies
- A payment gateway with a merchant platform with the marketplace, payment modules, and other seller tools
The COSS wallet
Hence the website claimed it to be a one-for-all wallet, which can store all our crypto funds in a safe environment. We were only able to find the exchange hot wallet.
We had previously warned users that it’s not a good idea to store coins or tokens directly in an exchange. Coss didn’t release an actual external wallet, and was advertising the exchange’s hot wallet as the ‘all-in-one-wallet’. Users ultimately had to lose access to all funds kept in the Coss wallet.
The design and UX were not too appealing at all. This should’ve given investors a hint that Coss was never interested in making its users’ lives better. They just created an ad-hoc, barely functional exchange to amass funds.
The taste of Etherdelta is on the tongue. Whilst we accept it for ED as it is decentralized as a main advantage. We don’t like it as a centralized fee-based exchange. There were some advantages the COSS exchange offered. One of its features was the very high amount of very niche altcoins. Which are likely rare to find on other exchanges, and fast transaction processing. Furthermore, from an investors point of view, the really interesting features kick in as follows:
- All COSS traders started with a trading fee of 0.2% as a default. With increasing trading volume, this can go down to 0.04%.
- A very generous amount of 50% of their Exchange revenue was issued to the token holders of COSS. Which made you participate in the growth of the company.
Our verdict on it was that we didn’t like the interface very much. Nor found it comfortable to trade there.
Interesting: COSS offered direct transfers of your fund between the wallets, the exchange, and the merchant platform. Be it all in one backend.
The Payment Gateway
We now see Coss’ payment gateway as just another way to gather more funds to make their ultimate exit scam as profitable as possible.
As one of the SmartOptions.Io Team is into e-commerce. We saw that the niche of payment providers was paying off. At least for the ones that are able to edge over the competition. The approach of bringing Cryptos to mainstream PoS was not new. Others alike are doing pretty well in other markets with the establishment of this goal.
Once integrated with their seller tools. Customers could pay with BTC, ETH, LTC, DASH, NEM, LSK, ARK, and their in-platform token VRS. And this would all be deposited into the merchant’s Coss wallet.
The gateway was used by 100+ stores last we checked. It was low at the time but might have increased over the next couple of years.
In terms of revenue generation, it is interesting that they took a 0.75% transaction fee with the COSS merchant platform. Even more interesting for the token holders is that they again got 50% of this revenue paid as dividends. This could be understood as how Coss attracted investors into buying more and more of its token by offering highly generous dividends.
Register an exchange account on coss then move eth or something into coss wallet. Then exchange coss/eth
I have a small amount of coss and have received tiny amounts of many coins from them.
Can you also describe how to buy their tokens because I tried to go on their site and couldn’t.
If you want to get in, you have to use an exchange like HitBTC, deposit ETH, move it to your trading account and then buy it on the COSS/ETH pair.