Why Experts Think This New Crypto Is A Scam

A new LGBTQ token called MariCoin raises concerns.

One of the many potential benefits of cryptocurrencies and blockchain technology is it can empower marginalized communities. Cryptos can build communities, increase financial accessibility, and help people escape stigma.

Unfortunately, the lack of regulation and proliferation of scams also means there's little to stop unscrupulous players attempting to exploit those potential benefits. Which is exactly what some fear a new Spanish LGBTQ token called MariCoin could be trying to do.

MariCoin isn't the first LGBTQ crypto project

Before we get into the reasons experts are concerned about MariCoin, let's touch on some positive ways cryptocurrency and blockchain could help the LGBTQ community.

• There's a blockchain marriage certificate project that helps couples in countries where same-sex marriage is illegal.
• Launched in 2021, the Pride token (PRIDE) wants to create a payment system capable of funding meaningful change.
• The LGBT Token (LGBT) that launched in 2018 aims to harness the economic potential of the LGBTQ economy and put some of the proceeds back into the community.
• The anonymous nature of the blockchain could help people who live in countries where same-sex activity is criminalized to move money freely and avoid having their assets frozen by authorities.

Why MariCoin raises red flags

According to its website, MariCoin will be, "A social, ethical, transparent and transversal means of payment." The idea is the tokens would work as a form of payment in various businesses that have signed up to an equality manifesto. The coin completed a week-long pilot in Madrid before it launched in 2022.

Co-founder Juan Belmonte told Reuters, "Since we move this economy, why shouldn't our community profit from it, instead of banks, insurance companies or big corporations that often don't help LGBT+ people?" The idea itself sounds great. But as a potential investment, it raises a lot of red flags.

1. The name plays on a homophobic slur

The name MariCoin comes from an offensive homophobic word in Spanish. Now, it could be an attempt to reclaim the term -- as the founders told CoinTelegraph it was. But if that's the case, given the token's mission and the unfavorable responses on social media, it seems misguided.

2. It doesn't have a whitepaper

When you're evaluating a cryptocurrency, one of the first ports of call should be its whitepaper. This is where you'll find information about what problems the token plans to solve, and how it plans to do it. Responding to criticisms, on Jan. 7, MariCoin's co-founder Juan Belmonte promised CoinTelegraph the first version of its whitepaper would be available "next week." But over two weeks later at time of writing (Jan. 24) there's no sign of the whitepaper.

3. There are errors on its website

The website is pretty basic. In fact, there's really only one page and you'll get more information from the Reuters and CoinTelegraph articles than from the site. Even the basic navigation doesn't add up. For example, there are three 'waiting list' buttons. One goes to a Google form where you can sign up to the new extended waiting list, and the other two go to a page that says the waiting list is closed. Moreover, Google Forms is not the most professional way to do a token pre-sale.

The other links go to a Change.org petition that hasn't yet received 200 signatures and an email contact form. Given the project says 10,000 people signed up to the initial pre-sale waiting list, this itself is suspect -- it means less than 2% of them signed the petition. Though this could be because it isn't clear what the petition is trying to achieve.

The slightly odd English can be attributed to sub-optimal Spanish translation. But, there's also no information about the team, no details on how the token will work -- such as how many will be issued, and no info on which merchants will accept the token. Finally, it claims to be the first coin aimed at the LGBTQ community, but it isn't.

Buyer beware

MariCoin raises a number of red flags, even if you're trying to give it the benefit of the doubt. On the plus side, it received an Algorand (ALGO) accelerator program grant, which gives it more legitimacy. It could be a genuine project run by people who aren't super familiar with the crypto world. There's a chance they've rushed to get something to market, and not realized a crypto token with no whitepaper and a poor website would cause concern. However, there's also a chance there's something more concerning going on.

Its website says the coin will be released on main cryptocurrency exchanges in February and offers people the chance to reserve MariCoins beforehand at the starting price of $0.025 by joining the extended waiting list. This seems like an extremely risky proposition. Nobody knows what will happen to MariCoin's price when it (and if) is released on crypto exchanges. There's no info about how many tokens will be issued, how many are owned by MariCoin's founders, and where it might be traded.

If you want to support MariCoin, the best bet is to wait until there's a lot more information available. You need to see its whitepaper and understand the details of how the token works before you spend a cent. Try not to get blinded by the project's ideals and evaluate it as an investment. If it didn't promise to do something good for the LGBTQ community, would you give it a second glance? I know I wouldn't.