Swiss crypto-mining startup, envion AG, has called on crypto exchanges around the world to cease trading in EVN tokens. Apparently, a large number of tokens have been generated illegally, part of which had already been put in circulation and sold. Envion’s CEO Matthias Woestmann announced the release of new EVN tokens and a token swap.

Held between December 2017 and January 2018, the envion Initial Coin Offering (ICO) is considered to be one of the most successful crowdfunding campaigns in the recent years and has exceeded all expectations. For a period of time, the volume of investment reached well over $100 million.

Envion’s commitment to power the extremely energy-intensive mining of cryptocurrency with electricity from renewable energy sources seems to have hit the pulse of the time.

It has now been discovered that, in addition to the 86 million tokens issued legitimately in the ICO, another 40 million have been generated without the knowledge of the Board of Directors. These were parked on various virtual wallets, some of which were then further distributed. After advertising the tokens on social media platforms, a portion of these digital securities was sold by the fraud perpetrators to crypto exchanges.

Envion’s CEO Matthias Woestmann: “It was our ambition to make crypto mining go green. I am all the more disappointed by this fraud, which has stricken not only our company, but also the entire Blockchain world.”

The tokens offered in the ICO were structured as profit participation rights in accordance with German law. The interest is is paid as a participation in the profits of the company.

The envion token is based on a so-called “Smart Contract,” written in the programming language known as “Solidity”. The Smart Contract determins conditions and functionality for the issuance and trading of the token.

Investors were given the option to make the payments for their invested amounts either by cryptocurrencies, Bitcoin or Ether, or by credit card. Each token has the nominal value of $1.00. Consequently, each investor received the exact number of tokens according to the capital that was provided.

The number of the officially-placed tokens issued in the course of the envion ICO is 86 million. Furthermore, according to the prospectus, around 17 million tokens were granted free of charge to the company and its founders and for the bounty program. However, an internal audit has revealed that more than 40 million tokens have been generated without envion’s Board of Directors’ authorization. Utilizing a cascade of wallet addresses up to 12 million tokens were redistributed. Evidently, the purpose was to impede the investigation concerning the whereabouts of the tokens. Several million tokens have already been resold through various crypto exchanges, profits went to unknown actors. Based on the tokens’ nominal value, the loss amounts to $40 million.

The above findings are detailed in the report of an independent Blockchain expert group, which was commissioned by envion AG. This report was verified and confirmed by Canadian security firm “Canadian Blockchain Intelligence Group” (BIG). Woestmann filed a criminal complaint in Berlin and informed the Swiss financial supervisory authority FINMA.

Woestmann says, “I promise all investors that we will resolve this case as quickly as possible. Subscribers to the ICO should be largely protected from loss by a token swap.”

It is Woestmann’s intent to replace all issued EVN tokens with new EVN2 tokens. The old tokens are no longer valid and will be excluded from the dividend process. Trading agencies have been asked to terminate the distribution of the original EVN tokens. Currently, a revised Smart Contract is being drafted and will be reviewed before application.

About envion:

Envion is a German-Swiss technology company, which has developed an energy-efficient alternative for the creation of cryptocurrency, the so-called crypto-mining. The key concept involves container-based Mobile Mining Units (MMUs), which can be flexibly and decentralized deployed at cost-effective energy sources anywhere in the world and controlled remotely. The MMU’s efficient cooling system makes them particularly competitive.

Currently, the envion AG’s Board of Directors has neither access to the website www.envion.org, nor the e-mail services under that domain. Until access is restored, the authorized address for the company is www.envion-recovery.org.