An ICO is the latest way for cryptocurrency start-ups to raise money by issuing their own digital tokens in exchange for a virtual currency like ether or bitcoin. Investors don't get a stake in the company, but the tokens they receive can be traded or used on a service provided by the platform. ICOs have exploded with more than $3.55 billion raised via this method so far this year.
On Monday, TokenLot, the firm that hosted the ICO, put out a statement saying the Confido team had "pulled an exit scam."
The Medium post said TokenLot's lines of communication with the cryptocurrency company had been closed and it doesn't have any more information outside what has been public. It said that Confido had shown all the required proof needed to list its ICO on the platform.
However, TokenLot said that it was looking for clues to track down the Confido team. It said some of the ether tokens collected during the ICO had been sent to an account held with Bittrex, a cryptocurrency exchange.
TokenLot added that it had been in contact with Bittrex and that it had confirmed the account that the ether was sent to an account where a "know your customer" check was authenticated. This is a process that is used to verify people are who they say they are online.
Bittrex did not reply to a CNBC request for comment via Twitter.
TokenLot also said it had reached out to Kucoin, a Chinese exchange that listed the contract for differences token issued by Confido. Some people took to Reddit to slam KuCoin for not vetting the company properly.
A spokesperson for KuCoin told CNBC on Tuesday: "In order to protect the interests of investors, Kucoin has suspended trading of CFD and are actively seeking contact with the CFD team. We have also started to implement an emergency loss prevention program to help reduce the losses of CFD token investors."
"If the Kucoin team is unable to contact the CFD team shortly, and re-enable normal trading, the final decision on trading stoppage will be made in a follow-up announcement on the website."