Expensive SOS Ltd (NYSE:SOS), let’s not mince phrases. It is over between us. Final Friday brief sellers Hindenburg and Culper Analysis instructed me you can be a complete fraud. However I gave SOS inventory the advantage of the doubt. In spite of everything, their sort is as usually improper as it’s proper.

Nonetheless, every week has handed since then and all you despatched me is a 200 phrase message. boilerplate press launch. In it, you assured me that you just “put together a extra detailed response to the false innuendos and lies which might be spreading”. However, honey, a 30-second cellphone video of your 10,000+ mining rigs uploaded to Twitter (together with a corresponding press launch) would have achieved us higher. As a substitute, I am caught shopping YouTube for grainy third-party movies of your supposed mining operations, the place the wiring bears little resemblance to the elegant footage you uploaded to your official web site.

Perhaps the video is actual. I actually cannot inform. However now that your inventory is up once more since these nasty brief sellers made their claims, I say goodbye to you. And I take my cash with me for good.

SOS inventory: a dream made in Cryptoland

It began so splendidly between us. You had been an unprofitable Chinese language finance firm, however you had huge goals to begin a Bitcoin (CCC:BTC-USD) mining. If you instructed me on January 21 that you just had gotten 15,645 new era mining platforms to dwell this dream, I used to be hooked.

Over time, I’ve recognized many Bitcoin miners. Riot blockchain (NASDAQ:RIOT) and Digital marathon (NASDAQ:MARA) come to thoughts. They usually taught everybody one factor: Shopping for platforms throughout crypto value spikes is almost not possible. Most companies have to attend 4 to eight months for supply. Many even resort to purchase complete companies to pay money for extra.

Nonetheless, you appeared to have all of it discovered. Your buy of 15,645 rigs from HY Worldwide Group New York would have propelled you into the large leagues when it comes to mining energy. At present Bitcoin costs, this may have earned round $ 5.5 million in income monthly. Even at vitality prices of $ 0.05 / kWh, that interprets into a powerful return on funding (ROI) of 5.6 months.

Then you definately satisfied me that you just had put in 10,000 machines in a month to get them organized. Some business veterans might need rolled their eyes at this ridiculous pace. However not me. Perhaps, as a result of I assumed an organization based mostly in China might purchase Chinese language rigs extra simply than a western miner. Or perhaps it is simply because I wished to assume it is perhaps true.

The US Securities and Alternate Fee (SEC) has pursued dozens fraudulent Bitcoin mining gamers. Why could not the SOS inventory be that prince charming in a sea of ​​ugly hawkers?

Was all of it a lie?

Not one of the pictures you despatched me had been actual, had been they? Your February 23 press launch on “SOS Mining Rigs” didn’t function the T2T 37T or A10 Professionals miners that you just claimed to have bought, however as an alternative Miners of Avalon A1066, a very completely different materials. I might need ignored the minor variations at first, however even a fast verify Amazon (NASDAQ:AMZN) exhibits that the pictures don’t match.

Even the pictures of your pals turned out to be faux. Pictures of your Canadian crypto acquisition goal, FXK Expertise, had been “survey from a legit Chinese language mining firm referred to as RHY. Not less than you had the decency to take away the watermark earlier than sending them. However such hijackings nonetheless border on securities fraud.

I had my share of ugly Tinder Appointment. Some have even used pictures of 10 years outdated to attempt to look youthful. However not less than they had been utilizing pictures of themselves, not these taken from a fast picture search.

On the path of paper

Then there have been your public deposits. After all, you could have been good to cowl your tracks. However even the most effective made-up tales have holes.

Initially, your headquarters at 888 Changbaishan Highway ought to have been a lethal reward. After I tried to go all I obtained was a three star resort. Resort! You may have used any variety of legislation companies or shared workplaces. Even a telephone sales space in a Chinese language model of We work would have been sufficient.

I do know you want your house. However simply be trustworthy about the place you might be. I deserve this in order for you me to consider in SOS motion.

Now, I am not even certain about your 15,645 mining rigs anymore. Not solely did your provider share identical handle as your legislation agency – telltale indicators of a non-existent entrance firm – however their web site now exhibits a 502 error. It is like the corporate by no means existed.

What to do with SOS Inventory?

Perhaps I am too arduous. In spite of everything, crypto is a younger house and the FUDers (worry, uncertainty and doubt) at all times attempt to deter me from fascinating investments. Since final 12 months, Bitcoin miners have grown by 1,500% because of their unusually excessive working leverage. I am glad I had the arrogance in myself to persevere in all of this and keep invested.

In the meantime, the SOS share value is predicted to proceed to rise as Bitcoin costs rise. Within the brief time period, different traders you’ve got attached will proceed to outbid you as when you have genuinely skilled mining capability.

I assume you may at all times persuade me to remain, nevertheless it’s gonna be rather more tough now. Some pictures of your 10,000 put in miners would have been sufficient final week – that is when these rumors began to unfold. However now that you’ve got had a full week to organize, I won’t consider something lower than an official video of your machines alongside a replica of as we speak’s. China Each day (or one other time-stamped half).

At this level, nonetheless, I’m shifting on. Your valuation is now not low-cost. Extra, Argo block chain (OTCMKTS:ARBKF) may have 1.68 exahash by Q2 2021 – 3 times greater than you. Regardless of this, their market cap of $ 1.26 billion is simply 50% greater. So in order for you my mailing handle you will see me there with my BFF bounce.

Perhaps the SEC will examine you sometime. Who is aware of what they may discover out, if in any respect. However within the meantime, good luck pushing these newbie and semi-professional DIY detectives again in your heels. I gave you the possibility to clarify your self. Now’s the time for us to go our separate methods.

As of the publication date, Tom Yeung doesn’t maintain (neither immediately nor not directly) any place within the securities talked about on this article.

Tom Yeung, CFA, is a Registered Funding Advisor whose mission is to convey simplicity to the world of investing.