Kapex Crypto: Signal for Tougher Regulation?

Koda Apex, aka KAPEX crypto, is a utility token designed to reward those who stake its sister token, $KODA. However, this coin can also be used for payments for both products and services. The main difference is the lower fees associated with KAPEX crypto.

Koda describes itself as 'a long-term deflationary store of value for SummitBC Ecosystem investors'. Due to its inflationary tokenomics, the project is an excellent choice for long-term investment, it claims.

Let's look at some of the main features and benefits of the project.

Rewards

As mentioned above, KAPEX crypto is essentially the reward token for those staking on the parent network. In addition, every transaction across the ecosystem increases the token's liquidity.

So other than rewards for passive staking, what other benefits are there to holding the coin? The benefits are wide-ranging and include:

• Paying of exchange fees.

• Paying service and product fees.

• Purchasing of NFTs.

• Paying staff or contractors.

• Motivating team members as a bonus.

• All business-to-consumer transactions.

• Peer-to-peer transactions.

In addition to the above, the project has very low network fees, resulting in ultra-low transaction costs. Its supply is controlled by algorithmic tokenomics and backed by its sister coin. Furthermore, anyone looking to unstake their KODA will need to pay for this with KAPEX.

It sounds like an excellent crypto to get involved in, and, with prices currently at historic lows, now is a good time to buy. But are there any drawbacks?

Compromise

Sadly, the program was compromised via both PancakeSwap and SummitSwap on 17 October, 2022, with the loss of some 78 BNB coins equalling £21,561 of user funds. As a consequence, the management team has advised not to buy the coin going forward. The exact details are unclear, but it appears to be the result of a vanity address exploit.

This hack and the subsequent price drop are obviously alarming and not a great look for the team behind the project.

Both tokens are managed by 'Summit Better Crypto Limited', which describes itself as a "PR and marketing firm specialising in the promotions of projects within the Cryptocurrency world".

As the company was only set up in May 2021, no filings of accounts are available for analysis. Furthermore, the company website states, "SummitBC employs third-party developers to support the projects we are promoting". Make of this what you will.

Something we can take away from this project is the urgent need for comprehensive regulation in the crypto space. While there is nothing to suggest that there has been any wrongdoing in this example, the collapse of KAPEX value shows that consumers desperately need better protection.

Furthermore, this example shows that it is important for consumers to carry out stringent due diligence to ensure any investments they make are based on realistic future projections rather than promotional shilling through social media or so-called 'crypto influencers'.