Phoenix Community Capital, which has links to a pair of U.K. All-Party Parliamentary Groups, appears to have left backers missing tens of thousands of pounds.
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A crypto investment firm with ties to a pair of U.K. parliamentary groups appears to have vanished, leaving investors out tens of thousands of pounds.
The disappearance and possible rug-pull by Phoenix Community Capital (PCC) has not only left backers in the lurch, it has thrown a spotlight onto All Party Parliamentary Groups (APPGs) that the investment company used to give itself a sheen of respectability, according to The Guardian.
Phoenix Community Capital used the tagline "Rise from the ashes of traditional finance," and promised "large scale, high-yield return on investments" to investors who bought its FIRE tokens, according to its website. Those tokens were placed in reward-bearing "nests" that used "trusted and experienced advisors who research new trends and opportunities for the community investment portfolio."
FIRE peaked at more than $812 on Feb. 16, 2022, before plunging to $18 in May and its current $0.29 as of Feb. 24. Which is a theoretical price, as 24-hour trading volume is $1. Its founders claimed a value of $800 million last year, The Guardian said.
PCC was a sponsor of the APPG on blockchain, giving £5,000 (about $6,000) in 2022. Its co-founder, Luke Sullivan, spoke at several events during Metaverse Week for the APPG on metaverse and Web 3.0. The former is run by an MP and the latter by a member of the House of Lords.
The case has raised questions about the role of APPGs just as growing legislative action on crypto regulation has highlighted an exponential increase in the scale of lobbying by U.K. crypto and blockchain companies.
On Feb. 1, the government laid out plans for what it said was a comprehensive regulatory regime designed to provide investors with greater transparency and create a "robust world-first regime strengthening rules around the lending of cryptoassets, whilst enhancing consumer protection and the operational resilience of firms."
More broadly, while APPGs are unofficial and have no formal role in the legislative process, they "can be a magnet for those who want to get close to MPs and peers — or to pretend that they are for the sake of polishing their reputations," the news outlet said.
Suspicion of a rug pull, if that's what PCC's disappearance was, certainly won't help.
