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I was involved with one of the bigger ICO right at the beginning of the ICO craze. I had pretty regular conversations with the project founder and was in talks

I was involved with one of the bigger ICO right at the beginning of the ICO craze. I had pretty regular conversations with the project founder and was in talks to become the dev evangelist. The project had raised ~$5 million in ETH (this is when ETH was trading around $80). Despite the fact that this project had raised a crazy amount of money the whole project was being conceptualized and coded by a single 23 old guy who was promising features that much larger projects with teams of the best people in the field were yet to solve. Not to mention the project was blatantly lying about it's PoW algorithm. When I tried to point out that the project should use some of that money to organize the software engineering aspect the founder got pissed off with me accusing me of trying to run the project. They had a second round and raised even more money (in addition to the insane capgains on their first round). I check the github from time to time and it appears they've got at least 2 other devs involved and may actually bring a blockchain to market but this doesn't hide that fact that the project needed nowhere near the amount of money they raised. Hell they could've used a couple hundred grand from the first round and literally just paid a team of people to build the blockchain for them. did I get off of a gravy train? Yes. But there are more things to life than money.

phkahler 9y ago
If you're launching one of these, you don't really need investment. You just make sure you own the first batch of currency and get rich if it takes off. If you need investment then you don't really believe in your own stuff do you? Ponzi Ponzi Ponzi.
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- duxup 9y ago
  That guy on TV keeps telling me how awesome owning gold is... it is so awesome he wants to sell me his...
  - lightedman 9y ago
    If they're selling pure gold at less than or equal to $800/oz then it's well worth it at this very moment with gold trading around $1200/oz right now. 50% profit ain't shabby.
    - lightedman 9y ago
      Hmm, facts don't seem to be well-tolerated around here.
  - flimflamfloozle 9y ago
    That guy on TV is a broker. He doesn't want to hold any gold. He wants to sell and buy at the same time and make money off of the spread.
    - dmix 9y ago
      Not sure if the answer is obvious here but I don't know much about finance, does 'spread' here mean the difference in the asset price from purchase/sale time (whether by market change or artificial markup) or the brokering fees involved? or both?
      - hellbanner 9y ago
        #2: Any vendor will buy a good at say, $9 and sell at $10. In the US there are many pawn shops saying "We buy and sell gold!" - it's never at the same price. #1: A smart gold trader will buy low, sell high.. they will buy more gold when prices are low and advertise to sell more when the price is high.
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      - stagbeetle 9y ago
        Spread is, simply, the difference between the buying price and the selling price. Usually in the context of stocks. Brokering fees are not calculated in with the base prices, though it would be once it's time to calculate returns.
- ojr 9y ago
  its all speculation, speculation, speculation, just like the US stock market just less regulated, speculators get a bad rep but do more good than harm in an economy
- unkown-unknowns 9y ago
  Not entirely true. Even if you believe in your currency long term you still need money short term so that you can cover your own costs of living and the cost of hiring other people.
richardknop 9y ago
And what you described is one of the more "legitimate" ICOs. Many of them are outright scams. This one at least tries to do some token work while pocketing the massive amount of raised money.
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JSONwebtoken 9y ago
I don't know the degree of complexity or technical ambition of the project you were a part of, but it's not unusual for a 23 year old guy to write most of the Ethereum app. In fact, that's probably the reason why most ICOs are a scam, there's an insanely low barrier to building a proof of concept. The boilerplate is like 15 lines. When it's so easy that any 20 year old backend dev can issue a token, you should already know that no ETH-based app should be worth more than the same business model applied to a fiat currency.
- alistproducer2 9y ago
  >23 year old guy to write most of the Ethereum app The project is a from-scratch smart contract blockchain: including a new contract language
  - Moshe_Silnorin 9y ago
    The project is almost certainly Aeternity. They forked Zack's code, used his name to publicize their project and then paid Zack off to join their fork with tokens from his own chain! Zack is a smart guy but the whole thing is a shit show.
    - alistproducer2 9y ago
      I won't comment on who the project is. It's not my goal to bad mouth anyone. I just wanted to share my experience.
- the_stc 9y ago
  >the same business model applied to a fiat currency Ding ding ding, winner! So many of these just have no point in being as companies, let alone as a token. At The STC, we're going to end sex trafficking in just like Apple and Amazon (and now Google and Spotify) ended music piracy. To operate, we must be an extrajurisdictional company which makes cryptocurrencies a useful way to get investment and pay dividends. But we're not going to issue tokens -- only shares. Ethereum will help us keep track of share ownership and allow easy trading, but we're not a "blockchain company". I hope we see a new wave of post-ICO companies using these technologies as a means to an end, not an end in and of itself. We're probably leaving money on the table by saying that and not hyping up tokens and tech. Oh well, we're going to create a valuable business instead.
charlesdm 9y ago
Perhaps a stupid question since I haven't followed this too closely, but is it THAT easy to raise money with a project? I have seen some $50-80-100m numbers flying around recently.
- alistproducer2 9y ago
  yes it is. put up a site, write a white paper (even one that doesn't make any sense), create an ERC20 token and you can raise lots of money.
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  - MichaelGG 9y ago
    There's gotta be a catch though. It's that old joke about the economist seeing a $100 bill on the street, but knows it must not be real or someone else would have picked it up already.
do5 9y ago
Why bring age into the equation? That's quite discriminatory considering the creator of Ethereum is just 19 years old. Aside from that I'm 23 years old and have been developing software professionally in the past 8 years. Age isn't much of a factor anymore.
- lawless123 9y ago
  Because most people haven't been developing software since they were 15.
- alistproducer2 9y ago
  In the case of Vitalik, he was smart enough to enlist people more knowledgeable than him when organizing the Ethereum project. For example, he enlisted a PhD, Dr. Gavin Wood, to author the real white paper[0] (also known as the yellow paper). while it's possible that at 19 Vitalik could've been studying real CS long enough to work out the truely difficult parts of implementing his vision, it's highly unlikely and, to his credit, he was smart enough to know that. People who think they are the smartest people in the room rarely are. The really smart ones are the ones who realize this and are humble enough to seek the expertise of others. [0]:https://bravenewcoin.com/assets/Whitepapers/Ethereum-A-Secure-Decentralised-Generalised-Transaction-Ledger-Yellow-Paper.pdf https://bravenewcoin.com/assets/Whitepapers/Ethereum-A-Secur...

phkahler 9y ago

If you're launching one of these, you don't really need investment. You just make sure you own the first batch of currency and get rich if it takes off. If you need investment then you don't really believe in your own stuff do you? Ponzi Ponzi Ponzi.

deleted 9y ago
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duxup 9y ago
That guy on TV keeps telling me how awesome owning gold is... it is so awesome he wants to sell me his...
- lightedman 9y ago
  If they're selling pure gold at less than or equal to $800/oz then it's well worth it at this very moment with gold trading around $1200/oz right now. 50% profit ain't shabby.
  - lightedman 9y ago
    Hmm, facts don't seem to be well-tolerated around here.
- flimflamfloozle 9y ago
  That guy on TV is a broker. He doesn't want to hold any gold. He wants to sell and buy at the same time and make money off of the spread.
  - dmix 9y ago
    Not sure if the answer is obvious here but I don't know much about finance, does 'spread' here mean the difference in the asset price from purchase/sale time (whether by market change or artificial markup) or the brokering fees involved? or both?
    - hellbanner 9y ago
      #2: Any vendor will buy a good at say, $9 and sell at $10. In the US there are many pawn shops saying "We buy and sell gold!" - it's never at the same price. #1: A smart gold trader will buy low, sell high.. they will buy more gold when prices are low and advertise to sell more when the price is high.
      - deleted 9y ago
        [deleted]
    - stagbeetle 9y ago
      Spread is, simply, the difference between the buying price and the selling price. Usually in the context of stocks. Brokering fees are not calculated in with the base prices, though it would be once it's time to calculate returns.
ojr 9y ago
its all speculation, speculation, speculation, just like the US stock market just less regulated, speculators get a bad rep but do more good than harm in an economy
unkown-unknowns 9y ago
Not entirely true. Even if you believe in your currency long term you still need money short term so that you can cover your own costs of living and the cost of hiring other people.

richardknop 9y ago

And what you described is one of the more "legitimate" ICOs. Many of them are outright scams. This one at least tries to do some token work while pocketing the massive amount of raised money.

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JSONwebtoken 9y ago

I don't know the degree of complexity or technical ambition of the project you were a part of, but it's not unusual for a 23 year old guy to write most of the Ethereum app. In fact, that's probably the reason why most ICOs are a scam, there's an insanely low barrier to building a proof of concept. The boilerplate is like 15 lines. When it's so easy that any 20 year old backend dev can issue a token, you should already know that no ETH-based app should be worth more than the same business model applied to a fiat currency.

alistproducer2 9y ago
>23 year old guy to write most of the Ethereum app The project is a from-scratch smart contract blockchain: including a new contract language
- Moshe_Silnorin 9y ago
  The project is almost certainly Aeternity. They forked Zack's code, used his name to publicize their project and then paid Zack off to join their fork with tokens from his own chain! Zack is a smart guy but the whole thing is a shit show.
  - alistproducer2 9y ago
    I won't comment on who the project is. It's not my goal to bad mouth anyone. I just wanted to share my experience.
the_stc 9y ago
>the same business model applied to a fiat currency Ding ding ding, winner! So many of these just have no point in being as companies, let alone as a token. At The STC, we're going to end sex trafficking in just like Apple and Amazon (and now Google and Spotify) ended music piracy. To operate, we must be an extrajurisdictional company which makes cryptocurrencies a useful way to get investment and pay dividends. But we're not going to issue tokens -- only shares. Ethereum will help us keep track of share ownership and allow easy trading, but we're not a "blockchain company". I hope we see a new wave of post-ICO companies using these technologies as a means to an end, not an end in and of itself. We're probably leaving money on the table by saying that and not hyping up tokens and tech. Oh well, we're going to create a valuable business instead.

charlesdm 9y ago

Perhaps a stupid question since I haven't followed this too closely, but is it THAT easy to raise money with a project? I have seen some $50-80-100m numbers flying around recently.

alistproducer2 9y ago
yes it is. put up a site, write a white paper (even one that doesn't make any sense), create an ERC20 token and you can raise lots of money.
- deleted 9y ago
  [deleted]
- MichaelGG 9y ago
  There's gotta be a catch though. It's that old joke about the economist seeing a $100 bill on the street, but knows it must not be real or someone else would have picked it up already.

do5 9y ago

Why bring age into the equation? That's quite discriminatory considering the creator of Ethereum is just 19 years old. Aside from that I'm 23 years old and have been developing software professionally in the past 8 years. Age isn't much of a factor anymore.

lawless123 9y ago
Because most people haven't been developing software since they were 15.
alistproducer2 9y ago
In the case of Vitalik, he was smart enough to enlist people more knowledgeable than him when organizing the Ethereum project. For example, he enlisted a PhD, Dr. Gavin Wood, to author the real white paper[0] (also known as the yellow paper). while it's possible that at 19 Vitalik could've been studying real CS long enough to work out the truely difficult parts of implementing his vision, it's highly unlikely and, to his credit, he was smart enough to know that. People who think they are the smartest people in the room rarely are. The really smart ones are the ones who realize this and are humble enough to seek the expertise of others. [0]:https://bravenewcoin.com/assets/Whitepapers/Ethereum-A-Secure-Decentralised-Generalised-Transaction-Ledger-Yellow-Paper.pdf https://bravenewcoin.com/assets/Whitepapers/Ethereum-A-Secur...