Crypto Déjà Vu? xStocks Founders Tied to Failed Project DAOstack

The stock tokenization market has been garnering significant attention recently due to efforts by the Swiss-based platform xStocks. However, recent findings have cast a dark shadow over the company, bringing to light, once more, the saying that all that glitters is not gold.

The founders of xStocks and its parent company, Backed Finance, have been linked to the now-defunct crypto startup, DAOstack. DAOstack, a decentralized governance platform, shuttered its operations three years ago, citing exhausted capital despite having raised millions of dollars in funding within four years.

xStocks’ Founders’ History Unveiled

Data from LinkedIn, which had been altered at press time, disclosed that xStocks’ co-founders, Adam Levi, Yehonatan Goldman, and Roberto Klein, had their last experience from handling DAOstack. The infrastructure firm raised roughly $30 million from private rounds, pre-sales, and initial coin offerings (ICOs) between the fourth quarter of 2017 and May 2018. 

By the end of 2022, DAOstack announced that it was shutting down due to the market downturn and depleted capital. The company exhausted its funds despite sunsetting other projects to focus on just one, Common, which was a platform for open collaboration. 

The bankrupt firm launched the Common Open Development (COD) program, inviting interested participants to contribute to the development of the product and bring it to market success. There have been no updates on the program or product since then.

Since the launch of DAOstack’s native asset, GEN, in 2020, the coin has generally been in decline, yielding zero returns to investors. The token never reached the funding price, even at its peak, and experienced a significant crash in May 2021. Data from DEXScreener shows the token trading around $0.0014 at the time of writing. 

Crypto Déjà Vu?

The pseudonymous Web3 community builder CryptoBrave revealed that the DAOstack team failed to list GEN on even a small exchange; consequently, the token plummeted to zero after its issuance. Notably, the project’s team has an Israeli background and as such, is likely to be “utterly irresponsible to users from start to finish.”

Moving onto the new project, xStocks, the co-founders started with a bang. On June 30, the company launched over 60 tokenized equities on Solana and leading centralized crypto exchanges, including Kraken and Bybit. The tokenized stocks include Nvidia, Tesla, Circle, and Strategy.

The crypto-stock narrative is spreading fast, and several centralized and decentralized platforms are jumping on it, integrating xStocks to give users access to the products. With the xStocks team’s history coming to light, the crypto community is concerned that a repetition of past events may occur.

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