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One of the biggest issue is to make a distinction of what is a legit ICO vs a pyramid scam/pure fraud. Without a reliable source of truth, anyone can make a sp

One of the biggest issue is to make a distinction of what is a legit ICO vs a pyramid scam/pure fraud. Without a reliable source of truth, anyone can make a splashy website, add a bunch of advisors, create a catchy "kickstarter" selling point and raise millions. The issue with regulators is that they may enforce the same kind of scrunity applied to big financial firms to legit ICO and that can stiffle startup to raise money. My fear is that pushes the whole ICO game for only people who have the existing expertise in working around the regulatory rules; then only big players or people with big resources can play the ICO game.

aaron-lebo 9y ago
Who cares? What makes ICOs good in and of themselves? The % of people who actually need to raise tens of millions of dollars before they've built anything is almost nil. It incentivises empty promises and bullshit marketing and idea guys who have never built anything real in their life. Those are bad incentives for those businesses and for consumers, because they're the ones who ultimately pay for bad products.
- deleted 9y ago
  [deleted]
AJ007 9y ago
There just haven't been enough enforcement actions yet. "Advisors" will think twice once there is a history of people doing these paid endorsements for fraudulent fundraising losing their jobs and going to jail.
- mbgaxyz 9y ago
  Nobody wants to be the first ICO "advisor" to be made an example of... https://www.bitsonline.com/china-death-penalty-ico-traders/ https://www.bitsonline.com/china-death-penalty-ico-traders/ https://www.cbsnews.com/news/death-penalty-for-chinese-ant-farm-scammer/ https://www.cbsnews.com/news/death-penalty-for-chinese-ant-f... http://www.chinadaily.com.cn/china/2011-11/09/content_14061161.htm http://www.chinadaily.com.cn/china/2011-11/09/content_140611...
problems 9y ago
I have an email address that's on the old Mt.Gox leaked database. I get spam every day now advertising this or that new ICO. And I check up on them and every time they're making millions. New way to earn cash from spam I guess...
the_stc 9y ago
It's telling that the author had to use Ethereum as an example. It's just really hard to find good ICO examples that make sense and have a real business. Most ICOs have a hard time justifying their token. Some are obviously just speculative investments. I hope ICOs come to an end for the most part. We're doing something similar to an ICO, except issuing shares. Shares are a known thing, and well established. Share price should grow based on the company's prospects, not pumping schemes. Cryptocurrency fundraising as a whole is still incredibly valuable. In our case, legal risk means we can't raise money from people we know (oh, how that'd be so much easier!). Even without the anonymity issues, I think a lot of companies are going to abandon ICOs after the token bubble pops and stick to traditional share-selling, using tokens as a ledger.
- dharma1 9y ago
  while I agree with you, I think the regulators (SEC already said as much) have even more of an issue with unregulated securities/shares

aaron-lebo 9y ago

Who cares? What makes ICOs good in and of themselves? The % of people who actually need to raise tens of millions of dollars before they've built anything is almost nil. It incentivises empty promises and bullshit marketing and idea guys who have never built anything real in their life. Those are bad incentives for those businesses and for consumers, because they're the ones who ultimately pay for bad products.

deleted 9y ago
[deleted]

AJ007 9y ago

There just haven't been enough enforcement actions yet. "Advisors" will think twice once there is a history of people doing these paid endorsements for fraudulent fundraising losing their jobs and going to jail.

mbgaxyz 9y ago
Nobody wants to be the first ICO "advisor" to be made an example of... https://www.bitsonline.com/china-death-penalty-ico-traders/ https://www.bitsonline.com/china-death-penalty-ico-traders/ https://www.cbsnews.com/news/death-penalty-for-chinese-ant-farm-scammer/ https://www.cbsnews.com/news/death-penalty-for-chinese-ant-f... http://www.chinadaily.com.cn/china/2011-11/09/content_14061161.htm http://www.chinadaily.com.cn/china/2011-11/09/content_140611...

problems 9y ago

I have an email address that's on the old Mt.Gox leaked database. I get spam every day now advertising this or that new ICO. And I check up on them and every time they're making millions. New way to earn cash from spam I guess...

the_stc 9y ago

It's telling that the author had to use Ethereum as an example. It's just really hard to find good ICO examples that make sense and have a real business. Most ICOs have a hard time justifying their token. Some are obviously just speculative investments. I hope ICOs come to an end for the most part. We're doing something similar to an ICO, except issuing shares. Shares are a known thing, and well established. Share price should grow based on the company's prospects, not pumping schemes. Cryptocurrency fundraising as a whole is still incredibly valuable. In our case, legal risk means we can't raise money from people we know (oh, how that'd be so much easier!). Even without the anonymity issues, I think a lot of companies are going to abandon ICOs after the token bubble pops and stick to traditional share-selling, using tokens as a ledger.

dharma1 9y ago
while I agree with you, I think the regulators (SEC already said as much) have even more of an issue with unregulated securities/shares