Two blockchain projects have allegedly pulled off an exit scam duping the initial coin offering (ICO) investors for $8 million, according to a report by The Next Web.

Both RepuX and JoyToke had a month-long token sale between March and April last year and raised $4.7 million and $3.3 million respectively. RepuX raised the funds to build a “blockchain powered data market place,” while JoyToken was developing a decentralized gambling platform.

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As seen on the Companies House, both the startups have dissolved their offices earlier this week in the United Kingdom.

Moreover, the official Telegram channels related to both ICOs no longer exist and the websites of both companies were taken down. Even the Twitter handles of both the companies are inactive – RepuX’s handle last tweeted on October 15, 2018, while JoyToken last posted from its handle on July 20, 2018.

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A joint exit strategy

A quick research of the blockchain companies also shows close ties between the two. According to ICObench, both of them shared a couple of advisors – Lee Murphy and Mateusz Mach. Mach was featured in Forbes’ “30 Under 30” list of entrepreneurs.

Both companies even hired the same company for community management, which parted ways from both in May last year citing “irreconcilable differences.”

Similar to any other major ICO scams, both the companies showered cash to promote their token sales. In 2017, Andrew MacDonald, JoyToken’s CEO, even attended the North America Blockchain Expo and later in January 2018 tweeted that he was attending Unblock BC event in Dubai along with JoyToken’s “sister company” RepuX.

As mentioned by The Next Web, suspicions around both projects were first raised by the members of BitcoinTalk forum around a year ago as both companies failed to repay their ICO promoters.

ICO-related exit scams are not new in the decade-old industry. A study by ICO advisory firm Statis Group revealed that over 80 percent of ICOs in 2017 were scams – the largest being Pincoin ($660 million), Arisebank ($600 million) and Savedroid ($50 million). However, only 11 percent of the total invested amount was involved in fraudulent projects.