Initial Coin Offering scams
When it comes to regulations, not banning, we can breathe a sigh of relief, because governments try to secure us and our investments, not fight with our freedom that cryptocurrencies gave us.
Investing in ICO
ICO – Initial Coin Offering, is crowdfunding for a new cryptocurrency, collected in digital assets.
Cryptocurrencies in the last year became extremely popular and a lot of people started learning about digital assets just when “Bitcoin-mania” started. Unfortunately, most of them are only tempted by easy money and do not read much about cryptocurrency subject; they get to know the topic superficially.
That is one of the reasons why ICOs collect as much money as they can, and for sure, that is the main reason why there are so many scams. Sometimes people support ICO with their money, only because they are seduced by the vision of quick earnings. Most ICO scams pay enormous money for their marketing and the easiest way to collect money, is to play on emotions, this time on greed.
The idea behind cryptocurrencies is decentralization and one side of it is to be as far from governments as possible; which is a great idea. However, with so many people who don’t know as much about cryptocurrencies as they should, it is easy for a scam artist to deceive the masses. That gives a reason for governments and banks to intervene; and we know that cryptocurrencies are dangerous for their interests.
Unfortunately, people do not do the company background check. Also White Paper contains a lot of useful information.
We can count and mention ICOs which were in fact scam, but it is not a point of this article.
What to look at
- Read the ICO white paper. It looks like a scam? Probably it is a scam.
- Check the team and their experience, if they are anonymous or their experience is poor, do more research about them or the ICO.
- Look at the ICO ratings, if the new project isn’t rated, there is a chance that it is a scam.
- Contact with representatives, ask them difficult questions about their program and how they will manage it.
- What problem is the product solving?
- Check forums, look at their community, read posts about that ICO, there are a lot of people who have been victims of the scams, they will know better how to recognize a scam.
If it comes to the safety of the investment, it is a good thing that governments try to regulate ICOs, not to fight with them. It is harder for a scam artist to bilk you out of money, when there is the law which regulates the subject, in this case – cryptocurrencies.
Russia, try to regulate the amount of money which can be invested in ICO. Gibraltar tries to handle ICO with a restriction for issuers to follow the rules that include ‘adequate, accurate and balanced disclosure of information.’
Polish government paid Polish Youtuber to create anti-cryptocurrency spot on his channel and prime minister compares cryptocurrencies to the financial pyramid.
Every investment no matter if it is in cryptocurrency or in real estate is dangerous if you don’t know the subject, but that is not a reason to fight with cryptocurrencies. Governments should educate people, and YOU, before any investment, should learn more about the subject, not just only get familiar with the tip of the iceberg.
And if you want to make movies that warn against cryptocurrencies, please do it like this:
Educate yourself about cryptocurrencies!
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