After reports that traders and holders of the “Zugacoin” cryptocurrency are unable to make withdrawals, Nigerian crypto founder, Sam Zuga responded by accusing unnamed “ignorant people” of work to tarnish the project. A Nigerian expert advised potential zugacoin investors to prioritize learning finer details about the project before investing.
A financial system for the future
As promoters of zugacoin – a Nigerian cryptocurrency ostensibly created to end poverty in Africa – continue to promote the token as a legitimate digital currency, there are growing reports on social media of merchants and coin holders who failed to withdraw. These reports have sparked claims that the project is another scam cleverly disguised as a complex cryptocurrency project.
Complaints and allegations against the project have, in turn, prompted Archbishop Sam Zuga, the founder of Zugacoin, to issue a slew of Facebook posts condemning “ignorant people” peddling false information about the project. In one of his last posts, Zuga said that he was not engaged in cryptocurrency trading, but rather “building a digital financial system to fix a financial future.” He added that his crypto, which “automatically gives you 200% profit on any amount you transfer to him,” is only used as a “system pilot in this future.”
In the lengthy post of August 25, 2022, the founder denies allegations of manipulation within the Zugacoin ecosystem. Zuga’s post also explains how the ecosystem works and why some holders may have issues opting out. He said:
“The only challenge is the lack of user knowledge. Anyone can withdraw easily if there are fewer people withdrawing than depositing. No system can survive if what goes out is greater than what comes in.
“There are no problems anywhere in the Samzuga ecosystem. The only problem is your ignorance of how the system was designed to work. Merchants can transfer money from the merchant area of the merchant app to the merchants wallet and from there to P2P conveniently.
In his previous Facebook posts, Zuga similarly attacks anonymous people whom he accuses of sullying the “noble project” through their ignorance.
Experts question the project’s lack of transparency
However, despite Zuga’s fiery defense of the crypto project, influential players in Nigeria’s blockchain industry told Bitcoin.com News that they remain unconvinced. They point to the project’s lack of transparency or its apparent exploitation of the Nigerian people’s affinity with religion or their religious leaders as red flags.
One of the players, Ophi Rume, aka “Cryptopreacher”, told Bitcoin.com News that unless the founder of Zugacoin reveals the rest of the team behind the project, it will be difficult to pass judgment on the legitimacy of the project. Noting that scammers often exploit people’s desperation and ignorance, blockchain analyst and educator Rume said ordinary Nigerians should only consider investing in this project after doing their due diligence. He noted:
As basic as searching for words; Is Zugacoin a scam or a Ponzi scheme through Google, Nigerians can read and learn a lot about this scheme. Also, before investing, Nigerians should know the people involved in the project. They need to know the board, the developers, and whether the project is on Github.
According to Rume, when potential investors learn or become aware of such details about this project, they will probably decide not to invest and thus preserve their meager savings.
Meanwhile, another expert who wished to remain anonymous lamented the increasing use of religious titles by scammers when marketing their schemes to unsuspecting victims. According to the expert, when a questionable cryptocurrency project is carried by a religious leader, people refrain from criticizing it. The expert explained:
“I’ve found that no one wants to be seen as the doomsayer or the enemy of progress when it comes to questionable big projects like Zuga. Also, the founder is a Christian leader with a huge following who has also used his influence to project Zuga there.Remember Inksnation.
For Paul Ezeafulukwe, former president of Stakeholders in Blockchain Technology Association of Nigeria (SIBAN) and team leader at Bitget Africa, zugacoin is the most volatile cryptocurrency and one that has totally failed to deliver on its promises. Some of the pledges include claims that cryptocurrency will end poverty and help Nigeria reduce its debt.
“Another promise they have made that sounds like moonlight tales is their ability to pay off Nigeria’s $97 billion national debt and help Africa clear its debts. According to their position it’s clear they don’t understand how cryptocurrencies work I think the proponents have sold a lie that your ability to mint a token could translate into instant monetary value without creating an ecosystem to support the usefulness of the token”, explained the former leader of SIBAN.
Ezeafulukwe said it was unfortunate that some poor and gullible people invested in zugacoin based on these promises. For investors who are still considering buying zugacoins, Ezeafulukwe said they should “look at these two promises [poverty eradiction and paying off Nigeria’s debt] and do simple research to find out if these things are possible by a single individual.
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