Recently there has been a lot of buzz revolving Scharmbeck and their services.  Since launch there has been an enormous amount of skepticism and hype surrounding their Cryptostock IPO.  I would like to write this from a purely analytic and unbiased stance. 

Diclosure: I still have a small stake in Scharmbeck stock, though most of it was liquidated on the 500 BTC announcement news for reasons I am about to explain... I am also a “rich list” worldcoin holder.

https://cryptostocks.com/securities/60

As you can see, the 500 BTC announcement created serious momentum, but amongst who?  The answer to that is simple:  Gamblers....

The fact of the matter is that serious investors have several reasons to believe that this stock is not going to pay for itself, ever, regardless if it takes off, for anyone that buys into the second offering.  Why is this, and what are the warning signs?  Lets take a look and three reasons that create a little bit of suspicion, and downward momentum on the stock price. Also, I welcome the stockholders and company to take a stance here.

1)The 500 BTC bounty scares away serious investors (And those are the ones with the money, and who dumped their SBFS stock at .037-.042). 

            One thing is for sure, something that gained that much momentum that has nothing to do with the actual product and/or services being released can cause panic amongst investors because they know .05 is the ceiling for the next forseeable future, in which case, they have about a 4 million dollar wall (5,000BTC) to chew through if/when Scharmbeck proves themselves as a legitimate financial enterprise (plenty of time to get on board for most of us nerds).

2)Their company valuation is simply too high

                  So how does company valuation even work anyway?  Well the problem here is technically SBFS is an 'illegal' security if they were to list the company to have unregistered “ownership” of a registered business or company on Cryptostocks (For those in the game for a while, this is not news, but as a simple reminder, buying any “stock” on cryptostock is not buying any portion of the company legally, and thus 'projects/companies' cannot actually offer it).  The problem is Scharmbeck is asking for roughly $5,000,000 USD for 20% total feeshares of their services (90% of that from the second offering).  This kind of money is no small request, and all told with this recent attempted publicity move with the 500BTC, it scared away its more “serious” investors and attracted a slough of  gamblers who see this stock as essentially a lottery opportunity.  If they were were playing by standard valuation rules, and lets pretend that fee shares account for 100% of the company income, and thus feeshares=company ownership, then their company valuation is roughly $40,000,000 USD (4x the value of all the WDC in circulation!).  Ouch!

3)Their dividend was obviously padded, or there is something I'm not seeing here...

                  So a 16.264  BTC dividend from their last month of beta testing rounds.  That sounds great, right?  Well hold on, before we go rushing off to thinking that 'once Scharmbeck launches, the dividends will be WAY more than that, lets do some math:  That is roughly $13,000 worth of FEES.  The problem here is that, lets say Scharmbeck uses a similar fee structure to coinbase (1%).  So that means they did about 1.3 Million dollars in volume (or roughly 4 Million Worldcoins) passed through that “beta system” in a month. BUT WAIT, it gets worse, that would be the case if Shareholders got 100% of the feeshares, but as it stands, we only get 10%, oh shit, so that means they did 13 Million dollars in buy/sell actions and 40 million WDC in volume (That is roughly equivalent to the amount of coins in circulation if that is indeed the case.  That large dividend, needless to say, really scared me.  This reminds me of the early days of reddit where there were fake posters, fake accounts, and paid content writers.  This is known in the tech startup world as the “fake it 'till you make it strategy'.


In conclusion I am not questioning the legitimacy of Scharmbeck as a company, as one can form their own opinions on that topic, but one must be weary about handing over hard earned cash when dealing with this stock. Until it proves itself and secures some big named venders as merchants and has a large user base, their stock is a liability, and shouldn't need more than its initial raising of of capitol to at least open its doors and to start doing business, especially if their BETA test was so successful monetarily .  If and once that happens, and if the stock is low enough, you might see me jump back on the bandwagon, but WDC would have to take off like a rocket for this to ever sellout of their second offering or justify even a third of the price it is being sold at!