ENVION LIQUIDATION: SOME CONSIDERATIONS ON ENRICHMENT OF THE ACTORS

Envion ICO and the enrichment of its shareholders

A Swiss court effectively ordered the liquidation of ENVION AG. The company received a lot of money in its ICO from an estimated 30,000 investors: The ENVION token was sold in the ICO for USD 1 with discounts of up to 30%. According to ICObench and the official ENVION ICO site more than USD 100 million have been realized. The investors could pay with ETH, BTC as well as USD and EUR by credit card for their EVN tokens.


The Communicated Projections

Envion's projected mining profits
Envion’s projected mining profits

With the ICO proceeds in the amount of more than USD 100 million, a highly successful Swiss-German crypto-mining company should have emerged. The investors should have been able to participate in the predicted revenues of crypto-mining (with patented technologies) via their EVN tokens. According to statistics on Envion Analytics, there are currently more than 39,000 wallets holding EVN tokens. According to the calculations on the ICO website, each EVN token would have earned almost USD 40 profit share over time.

 2018201920202021202220232024
Profit per EVN Token1.622.253.164.446.238.7412.25
cumulated1.623.877.0311.4717.726.4439.95
Assuming more than 127 Million issued and outstanding EVN tokens the cumulated profits to EVN Token holders (i.e. ENVION creditors) would hypothetically amount to more than USD 4 Billion. That’s what ICO investors had been promised.

As a reminder, the EVN token was sold between USD 0.7 and USD 1 in the course of the ICO. In this respect, investors were promised an incredibly high return that could at best – if at all – have been achieved through the patented technology and strategic partnerships with the energy industry. As we know today, there was neither a patent nor a partnership despite the promises made by the ENVION people. These were false promises and statements.

Alleged Misappropriation of ICO Funds

However, ENVION has never started operations due to a shareholder dispute. The facts of this shareholder dispute have not yet been clarified. The funds of the ICO investors is used for lawyers, PR consultants, and lawsuits. We learned that a considerable part of the ICO money did not end up with the issuer – the Swiss ENVION AG – but with the shareholders of the company around Michael LUCKOW and Matthias WOESTMANN.

Most recently, the competent court in Switzerland ordered the liquidation of ENVION AG. No auditor could be found who would have issued the audit certificate required for the continuation of the company. Thus, the order for liquidation by the Swiss court was a logical conclusion. The liquidation was a shock for the founding team around Michael LUCKOW and his Berlin-based TRADO GmbH. Accordingly, LUCKOW and TRADO GmbH complained loudly and about worldwide press releases about the liquidation order. They would not have been heard sufficiently and it would all have been the fault and/or intention of Matthias WOESTMANN.

The fact is, however, that neither the white paper nor the ICO brochure nor the social media before or during the ENVION ICO mentioned TRADO GmbH or Michael LUCKOW. With which justification now a party position is complained here probably evades the common sense as well as any legal appreciation.

The Buyback of EVN Token

Considerations for the voluntary EVN Token Buyback
Considerations for the voluntary EVN Token Buyback

The shareholder group around Matthias WOESTMANN is supposed to welcome and actively support the ordered liquidation of ENVION AG and/or the voluntary repayment of EVN tokens. According to Michael LUCKOW, however, WOESTMANN wanted to enrich itself by the reimbursement. According to Michael LUCKOW, WOESTMANN wanted to buy back the EVN token from investors in exchange for BTC and ETH. This procedure would probably have two intended advantages for ENVION AG and WOESTMANN:

  • The accusation of fraud was made more difficult because everything had been repaid to the investors;
  • The ICO has been enriched by the exchange rate difference of the cryptocurrencies since the end of the ICO;

The price of ETH oscillated between EUR 571 and $ 1,121 during the ICO period from December 15, 2017, to January 14, 2018. According to the information available, a large part of the ETH obtained in the ICO was quickly sold and thus converted into FIAT.

Let us assume, for simplicity’s sake, that all ETH and BTC were sold and somewhere between 80 and 90 million US dollars were realized. In a Telegram posting on August 3, 2018, Martin LAURENT states that the ENVION had USD 70 million in FIAT, but that this had been reduced to USD 50 million.

We also know from the Berlin court files that Michael LUCKOW and TRADO GmbH also had USD 10 – 17 million FIAT. In total, FIAT money in the amount of USD 80 – 90 million was apparently available at some point in the 2nd quarter of 2018. Since then the prices of ETH and BTC have fallen dramatically:

Date/Event

Price BTC

Price ETH

Price Index

Jan 15, 2018 (Closing ICO)

13,600

1,259

100%

Dec 4, 2018 (Liquidation Order)

4,077

113

80%*

Loss in Percentage

-70%

-91%

(*) arithmetic mean of BTC/ETH

Since the closing of the ENVION ICO in mid-January 2018, the price of the BTC has fallen by some 70% and that of the ETH by more than 91%. The arithmetic mean of the price losses is therefore 80%. This assumption would have to be corrected in detail on the basis of the actual distribution between the BTC received and ETH.
Replacement, repayment, and enrichment

It is, therefore, an easy mathematical exercise to observe that for a buyback of all issued and outstanding EVN tokens only 20% of the amount received from the ICO is needed, i.e. 20 million. The difference between these 20 million dollars and the 90 million dollars that arrived at bank accounts of ENVION and/or its shareholders would thus be their enrichment. We are talking about USD 70 Million!

DateAmountExplanation
Jan 15, 2018 (Closing ICO)100,000,000Total Proceeds from ICO
Q2 2018 (Sale Off)90,000,000Proceeds from Sale of received crypto funds
Dec 4, 2018 (Liquidation Order)20,000,000Price to re-purchase crypto funds for EVN token buyback
Dec 4, 2018 (Liquidation Order)70,000,000Enrichment of Envion AG and/or its shareholders

This is, of course, only a superficial analysis which requires a detailed assessment of legal experts on the basis of the concrete data. It is a matter of fact, however, that the ENVION ICO guys made tons of money at the expense of ICO invstors.

We will continue to report.