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I know very little about ICOs other than what I have read on HN and HN comments so take what I'm saying with a pinch of salt. My understanding is that an ICO i

I know very little about ICOs other than what I have read on HN and HN comments so take what I'm saying with a pinch of salt. My understanding is that an ICO is like an IPO minus a century+ of regulation and oversight by the authorities and instead of a share of future earnings, you get a share of a closed economy. The oversight and rules governing stock offerings is fantastic no doubt but when you describe a Coin as a circular investment scam, I think you are glossing over the possibility that the economy you are buying into could become valuable. An example of this would be Second Life which at one point had a thriving virtual economy in digital goods. Extrapolating further, ICOs, due to their horizontal, borderless nature, are going to be instrumental in further tying together a global economy. Just like they used to say no two countries on the Dell supply chain would fight wars with each other, I can't imagine a world dominated by ICOs for different slivers of the online economy actually fighting an IRL war. Probably utopian but I think worrying about ICOs being a ponzi/greater fool get rich scheme overshadows its potentials.

Taek 9y ago
In 2001 if you said that the Internet was going to be worth $1 trillion dollars, you were correct. But 99% of investments on internet companies in 2001 were bad investments. That's where we are today with ICOs. Cryptocurrency is going to be absolutely massive, and it has some very intelligent people doing amazing things. But the vast majority of ICOs are going to flop. Look at the rankings in 2013: http://web.archive.org/web/20131218060943/http://coinmarketcap.com/ http://web.archive.org/web/20131218060943/http://coinmarketc...
- saimiam 9y ago
  If this is true, then VCs spreading their money across any and every ICO makes strategic business sense and should be applauded instead of being pilloried for being scam artists trying to fleece regular folks into buying coins.
  - Taek 9y ago
    That's only if you assume the tokens today will form the foundation of the $1 trillion cryptocurrency economy. The biggest projects of tomorrow may not exist yet, or they may take a very different shape than the volatile token economics we see today.
    - saimiam 9y ago
      That still doesn't call into question the VC's investment strategy. You can't always time the market waiting for the killer app of Coins. Waiting to black swan the ICO space like John Paulson did with housing isn't feasible in the aggregate.
api 9y ago
> you get a share of a closed economy. Who wants that? There are use cases where this is needed/desirable, but for the most part this is a bug and not a feature. I don't want to convert my general purpose currency into SomethingCoin to purchase Something. I want to purchase Something with general purpose currency.
- saimiam 9y ago
  (Standard caveat: I'm a Coin know-nothing) Once SomethingCoin becomes fungible with Something2Coin and Something14Coin, you could have the makings of an economic system. Edit1: Say you sold disk space for FileCoin, converted it and bought petfood using DogeCoin (I know Doge is for charity but hear me out), you wouldn't ever have to move money between IRL currency and Coins.

Taek 9y ago

In 2001 if you said that the Internet was going to be worth $1 trillion dollars, you were correct. But 99% of investments on internet companies in 2001 were bad investments. That's where we are today with ICOs. Cryptocurrency is going to be absolutely massive, and it has some very intelligent people doing amazing things. But the vast majority of ICOs are going to flop. Look at the rankings in 2013: http://web.archive.org/web/20131218060943/http://coinmarketcap.com/ http://web.archive.org/web/20131218060943/http://coinmarketc...

saimiam 9y ago
If this is true, then VCs spreading their money across any and every ICO makes strategic business sense and should be applauded instead of being pilloried for being scam artists trying to fleece regular folks into buying coins.
- Taek 9y ago
  That's only if you assume the tokens today will form the foundation of the $1 trillion cryptocurrency economy. The biggest projects of tomorrow may not exist yet, or they may take a very different shape than the volatile token economics we see today.
  - saimiam 9y ago
    That still doesn't call into question the VC's investment strategy. You can't always time the market waiting for the killer app of Coins. Waiting to black swan the ICO space like John Paulson did with housing isn't feasible in the aggregate.

api 9y ago

> you get a share of a closed economy. Who wants that? There are use cases where this is needed/desirable, but for the most part this is a bug and not a feature. I don't want to convert my general purpose currency into SomethingCoin to purchase Something. I want to purchase Something with general purpose currency.

saimiam 9y ago
(Standard caveat: I'm a Coin know-nothing) Once SomethingCoin becomes fungible with Something2Coin and Something14Coin, you could have the makings of an economic system. Edit1: Say you sold disk space for FileCoin, converted it and bought petfood using DogeCoin (I know Doge is for charity but hear me out), you wouldn't ever have to move money between IRL currency and Coins.