Is Nilam Resources The Latest Crypto Scam?
Nilam Resources (OTC PINK: NILA) has stirred controversy with its recent announcement of a letter of intent (LOI) to acquire 100% of the common stock of a special purpose entity, MindWave, holding 24,800 bitcoin. The deal, valued at over a billion dollars, has raised eyebrows within the crypto community and financial markets alike, amidst allegations of potential fraudulent activity.
The LOI, disclosed by Nilam Resources, outlines the acquisition of MindWave, a special purpose entity based in Mauritius, which purportedly holds substantial digital assets including 24,800 Bitcoin. According to the agreement, Nilam Resources plans to issue a newly authorized preferred class of stock in exchange for bitcoin, reportedly at a discounted rate relative to current market prices.
Nilam Resources CEO Pranjali More expressed enthusiasm about the acquisition, describing it as a significant strategic milestone for the company.
“The company and team have been working diligently over the last several months to finalize all agreements and due diligence necessary to proceed to a legally binding Letter of Intent,” he said.
Nilam has stated that it intends to use the bitcoin to serve as collateral for raising capital for investing in “high yield generating projects.”
Scam?
However, concerns have emerged regarding the legitimacy and transparency of the acquisition. Matthew Sigel, VanEck’s head of digital assets research, raised skepticism on X, suggesting a potential scam. Sigel highlighted the rapid surge in Nilam Resources’ stock value following the announcement and questioned the motivations behind issuing equity in exchange for bitcoin.
Moreover, the terms and provisions of the acquisition, to be detailed in definitive agreements, have sparked further scrutiny. The plan to issue a new class of preferred stock, entitling holders to conversion rights upon listing on NASDAQ or other defined liquidity events, has raised concerns about shareholder interests and regulatory compliance.
Amidst these allegations, Xyberdata Ltd., the purported partner in the deal, has defended the transaction. A certain Mr. Nadan, Director of Xyberdata, emphasized the company’s track record “of strategic partnerships, acquisitions and continued support innovation for the industry.”
Nilam Resources said it is focused on growth and positive impact, operating in dynamic fields like FinTech, MedTech, and ClimateTech. With a goal of tapping into the potential of frontier technologies, the firm seeks to tap into the innovative potential of these technologies and contribute to their growth while generating returns for its investors.
Cryptocurrencies experienced a robust start to the week, rebounding from recent losses as bitcoin surged above its 2021 peak. Bitcoin surpassed $70,000 during U.S. trading hours, marking its highest level in 10 days and achieving over a 7% gain within 24 hours.
Ethereum’s ether (ETH) also rose by 6% during this period, while tokens for major layer-1 blockchains Solana (SOL) and Avalanche (AVAX) saw gains of more than 10%. This rally extended across the entire digital asset market, with all constituents of the broad-market CoinDesk 20 Index (CD20) showing gains and the index itself up by 6.1% for the day.
Nilam Resources last traded at $0.095 on the OTC.
Information for this briefing was found via Coin Desk, Yahoo News!, and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
