Education By  Yuliia Rokytska
Normal 2236 10 Oct 2022

What is HEX?

By  Yuliia Rokytska 2236 10 Oct 2022
Photo - What is HEX?

What is HEX: revolutionary crypto industry token or another pyramid scheme?

Since the inception of HEX in December of 2019, there has always been much controversy around it.  Its supporters, the so-called "Hexicans", so cultish in their effusive praise of the founder, Richard Heart, while attacking anyone who dares to criticize Heart or  consider HEX to be a fraud. However, the HEX enemies have enough reason to believe that this is a scam.

According to HEX’s official website, the project says that HEX is the first certificate of deposit (CD) running on the blockchain. A certificate of deposit is a common service in traditional banking, where the client locks up the invested funds and the bank pays the client interest for using his money during some period of time . 

A HEX CD works in the same way as in staking since it pays a return to investors who decide to lock up their HEX holdings for some period of time. The one who contributed the most HEX tokens validates the transactions and gets the biggest passive income.

APY (Average Annual Percentage Yield) returns can be as high as 40%. The HEX crypto is minted to pay off existing holders after the expiration of the holding period.

The main goal of Richard Hart’s project is to increase the price of his token and to dominate other assets. The idea is to create a cryptocurrency that will rise faster than Ethereum and Bitcoin.

HEX  is structured so that, as the price of the token increases, the number of payouts will decrease. However, if the price suddenly collapses, token inflation will grow at an accelerated rate because more tokens will have to be created to pay off. But the project promises that the price will rise and users will get high passive income thanks to the generous APY. 

Why is the HEX project considered to be a scam?

The crypto community has a lot of doubts regarding this project for many reasons. One of the reasons is the reputation of its founder. In 2002, Richard Hart was sued by Peacefire.org for violating Washington's spam laws. He also promoted life extension products.

Finally, you can find information that in 2005-2007 the founder of HEX was investigated in Panama. He was suspected of having business with a criminal gang that included robbers, blackmailers, corrupt lawyers and judges. Previously, he had many other pseudonyms - James Hart, J. Richard, Richard Schuler.

Richard Hart is an eccentric crypto blogger with a dark past who has tried to create a cult of personality around himself. He constantly demonstrates his wealth and promises to make others rich. For example, Hart bought the world's largest diamond last year for $4.3 million in crypto.

Mistrust arises both directly to the token itself and to its use. It is not listed on any of the major exchanges and doesn't even have a whitepaper. While real CDs are used by banks to secure mortgages and loans, in Hart's project, tokens are simply temporarily blocked for rewards. Finally, according to opponents of the project, HEX is simply an Ethereum-based token without practical use, created solely to enrich its founder through the bankruptcy of investors, opponents of the project believe.  

In addition, many are discouraged by the statements on the project website that HEX will become better than Bitcoin, that the token's price is rising faster than ever, giving  a large number of bonuses and profit promises etc. Investors see this as a red sign of a scam.

People become more suspicious when they meet fans of this token. The Hexicans are possibly the most passionate and crazy community in all of crypto. Any time anyone criticizes HEX or Richard Heart on Twitter or other social media, an army of Hexicans pop up to attack that person and defend Heart and the project. They resemble bots by repeating the same pitch, stating how amazing and charitable Richard Heart is and how safe HEX is.

The HEX website even has a separate section dedicated to proving that HEX is not legally a scam . And this is the final proof for skeptical investors, as No legitimate project would ever have an entire page explaining how it's not a scam.

Unfortunately, the project continues to function due to the lack of regulation in the crypto sector and the non-compliance of HEX with the legal criteria of the Ponzi scheme.

Peter McCormack, host of The What Bitcoin Did podcast, said on a live stream with Richard Hart that HEX is such an obvious scam that it's either trolling or an art project. To which he replied: “My project may seem like a scam at first sight, but if you dig deeper, you will see that I just want to help people.”