Influencer "Crow" endorses Kine exchange! The more orders users place, the more they lose? Examining the suspicions surrounding Kine.

Well-known YouTuber and internet celebrity Crow recently endorsed the exchange Kine Exchange and established many Line communities, claiming to invest 50% of his own assets and lead members to make money together. However, the profit charts showing high leverage of up to 200 times and single-digit profit rates have raised suspicions of rebate manipulation in the exchange. In addition, there are also some doubts surrounding Kine Exchange itself.

What is Kine Protocol?

According to the Kine Protocol official website, Kine Protocol claims to be an early decentralized derivatives protocol, focusing on providing derivative services with 0 Gas fee and extremely low slippage, offering up to 200x leverage contract trading, one-click following, staking, and other functions.

The content states that Kine Protocol aims to create a derivative market with unlimited liquidity, facilitating users to trade quickly, transparently, and conveniently.

Doubt 1: Decentralized Exchange DEX?

Firstly, the Kine Exchange website presents icons for switching between CEX and DEX, allowing users to register and log in using email or phone number in the former and use self-custody wallets via links in the latter.

Through the Kine Protocol whitepaper and discussions with DeFi researcher JackChai.eth, it is understood that the trading mechanisms of these two channels utilize a "peer to pool model" similar to an automated market maker AMM, and rely on an undisclosed oracle to provide information on perpetual contract liquidation, margin system, reliable asset prices, and other data.

However, many aspects of the protocol remain unclear, such as the "segregation of funds between CEX and DEX" and the "oracle provider," which are not explicitly explained.

Despite reaching out to inquire about these issues with Kine Protocol, no clear response has been received, and updates will be ongoing.

Doubt 2: Low Total Value Locked TVL and Liquidity

Data from DeFiLlama shows that Kine Protocol's TVL has remained below $5 million for nearly a year, with a 24-hour trading volume of $109,000 and token liquidity of $179,000. Compared to mainstream DEXs, the disparity and low liquidity of funds are evident.

Providing decentralized derivative services requires a significant amount of liquidity, especially for a platform like Kine offering up to 200x leverage, raising questions about the source of its liquidity.

Doubt 3: High Centralization of Token Contracts

Using Token Sniffer for token contract analysis, the $KINE token scored only 25 out of 100 in a security assessment test, indicating a relatively high-risk token.

Specifically, concerns regarding the token contract include:

1. The contract contains ownership functions that cannot be relinquished: the team has the authority to modify the contract, such as prohibiting sales, adjusting Gas fees, or minting more tokens.
2. The token holdings of some holders account for more than 5% of the circulating token supply: certain wallets hold a large number of tokens, which could significantly impact prices when sold.

Additionally, the audit report provided on the Kine Protocol website, conducted by the cybersecurity company PeckShield, dated 2021, has not been updated in the past two years, posing risks in the smart contract.

Doubt 4: Lack of Transparency in Team Member Information

According to LinkedIn, the Kine team consists of only 4 main members, with a total of approximately 20 employees. The information regarding team members' identities provided on the official website is minimal and difficult to verify for authenticity, with even the CMO's profile showing only a picture of a cat and an introduction.

Furthermore, Kine's founder and CEO Lei Wang's official Twitter account has not been active for a year, indicating a lack of ongoing management.

Although Kine Protocol has 24,000 followers on Instagram and 112,000 followers on Twitter, the engagement rates are significantly low. Each tweet on Twitter, for example, only reaches a few hundred people.

Doubt 5: Claiming Investment from Huobi now HTX Investment

Twitter influencer Marc7Kevin explains that Kine itself has three company names: Kine Exchange, Kine Technology, and Kine Protocol.

Rootdata data indicates that Kine Technology received a $7 million investment in March 2021, with participation from major investment institutions such as OKX Ventures and Spartan Group, listing Huobi Ventures as well.

However, Huobi has denied these claims as rumors, stating they have not been involved in any Kine projects or investments.

Internet Celebrity Crow Promotes Kine Exchange

Contract-led 200x Leverage for Commission Rebates?

Recently, Crow has been promoting and endorsing Kine Exchange, emphasizing free contract-led trading to attract a large number of fans to join the group. However, images from within the group clearly show Crow using a staggering 200x leverage, leading members to earn returns ranging from 2% to 30%. With such high leverage, shouldn't higher fees be paid?

This issue has sparked controversy on Dcard and in some cryptocurrency trading KOL communities, criticizing the extreme measures taken to earn exchange rebates.

Upon actual calculation, checking the Kine Exchange website, the fees for opening and closing positions are not significantly different from those of other exchanges, at 0.05%.

"200x leverage" x "0.05% fee" x "opening 2 positions" = 20%

In other words, a position with 200x leverage needs to generate profits of over 20% to truly profit, otherwise it's merely a win in trading rate but a loss in position.

Crow's Class: Pay 50,000 TWD to Become a Member

The situation escalated as Crow recently launched a contract trading course, initially priced at 120,000 TWD but offered to group members at a discounted price of 50,000 TWD, seemingly forgetting the earlier promise of "free contract-led trading."

Reportedly, course purchasers will have the opportunity to hear higher-level courses from Crow, and Kine's owner will even "personally inform" when to buy which tokens.

However, during a live broadcast, Crow was mocked for not knowing what a trading chart tool TradingView is and using Google search results for analysis, raising doubts about their capabilities.

Crow's 50% Assets = $220?

Previously, Crow claimed to invest 50% of their assets in Kine. However, in a live broadcast on the 21st, even though it was set to private, it was noticeable that their contract account margin was only $222.5, prompting questions about their motives for creating the community.