Industry publication CCN has removed posts mentioning the gold-cryptocurrency project Karatbars, after it was revealed Florida’s financial regulators were investigating claims about establishing a ‘crypto bank’ in the state.
The Norwegian-based CCN Markets, known simply as ‘CCN’, which has been covering crypto-related news since 2013, removed references to Karatbars from its website, including three full-featured articles published this year.
The removal of the stories appears to coincide with an article published by CoinDesk on Friday claiming that the Florida Office of Financial Regulation (OFR) was investigating Karatbars’ promotions of a cryptocurrency bank in Miami, and quoting the OFR as saying that the company was not licensed or authorized to operate a bank in the jurisdiction.
Founded in Germany in 2014, the Karatbars website says it is an “attractive and affordable option for consumers to purchase 999.9 pure gold bullion”. The KBC token, which currently runs on the Ethereum blockchain, is reportedly a stable store of value and international payments solution for users.
The stories, which are labeled as sponsored, are no longer available from the CCN website, either returning as a 404 or redirecting to the homepage. However, they are still visible on Karatbar’s community pages and remain accessible from syndicated feeds on other media outlets. They can also be seen via The Internet Archive.
Syndicated feeds make it even more difficult to discern that the articles are paid content. However, many ‘pop-up’ publications steal media feeds to populate their websites, and these are not necessarily officially-sanctioned syndicators.
One CCN article, republished in The Bitcoin Pub, said that as the “first coin linked to a tangible asset, the KaratGold Coin (KBC) includes the advantages of a cryptocurrency and the trustworthiness of gold.” It concluded that the project will become the “new leading financial system of the world in the next ten years”.
Another CCN article titled: “Exploring The Karatbars Universe”, republished in CoinPlugs later in July described Karatbars as the “leader [for] modern gold products with the annual turnover bigger than 100 million euros.” Listing a whole suite of payment and blockchain services launches set to launch this year, the article concludes that Karatbars “is a true innovation on cryptocurrency and blockchain market”.
The exact time articles were removed remains unknown, but the articles were no longer accessible to readers early on Saturday morning. CCN’s Managing Editor could not be reached for comment.
Karatbars claimed to raise $100M in an ICO in 2018, and has said it will do another raise later this year. This isn’t the first time the authorities have scrutinized Karatbars. Financial regulators in Quebec, Namibia and the Netherlands all issued warnings in 2014 about investing into the company, when it offered commissions to users to sign up affiliates.
Pitching ads as ‘sponsored editorial’ is a common practice among industry news sites. An investigation by Breaker last year found some publications would run stories without highlighting they were sponsored, for sums ranging between $240 to $4,500.
When approached as part of the investigation, CCN was one of a handful of crypto publications that refused to engage in the scheme. A disclaimer at the bottom of one of the stories read “This is a submitted sponsored story. CCN urges readers to conduct their own research with due diligence into the company, product or service mentioned in the content above.”
Even so, studies suggest that readers have difficulty discerning the difference between sponsored content and real news, despite the label.
Crypto Briefing does not run sponsored stories.
CCN temporarily shut down in early June, complaining that a recent update to Google’s search rankings had led to a 71% drop in mobile traffic. It reversed its plans a few days later, with founder Jonas Borchgrevink saying there had been an unexpected uptick in traffic.