Bitcoin Forum

Are the bans and warnings on ICOs gravely serious? If it is, then why are the known venture capitalists like Sequoia Capital and Andreessen Horowitz still investing millions in ICOs?

Is the Chinese, Russian, US governments and others giving these warnings because they are scared people can fund themselves without their permission and authority?

https://media.coindesk.com/uploads/2017/09/Tokens.jpg

Filecoin's ICO, which began on August 10, quickly garnered millions in investment via CoinList, a joint project between Filecoin developer Protocol Labs and startup investment platform AngelList. That launch day was notable both for the large influx of purchases of Simple Agreements for Future Tokens, or SAFTs (effectively claims on tokens once the Filecoin network goes live), as well as the technology issues that quickly sprouted as accredited investors swamped the CoinList website.

Today, the ICO ended with approximately $205.8 million raised, a figure that adds to the $52 million collected in a presale that included Sequoia Capital, Andreessen Horowitz and Union Square Ventures, among others.

Read the full article https://www.coindesk.com/257-million-filecoin-breaks-time-record-ico-funding/

You seem to habitually fail to pay attention to important details.

That ICO began on August 10, and only $3 million was raised in past 3 days since ICO bad news.



It is legal ICO issuance with proper disclosures and was sold only to accredited investors. It is not these scammy ICOs we’ve been seeing that are not correctly issued under appropriate exemption from registration.

More importantly, even legal token issuance will mean those tokens are restricted securities that can only be sold on regulated exchanges. They can’t be traded decentralized and thus are not a cryptocurrency.

More details:

https://bitcointalk.org/index.php?topic=2146838.msg21616747#msg21616747
https://bitcointalk.org/index.php?topic=2156492.msg21615589#msg21615589

The message is clear, legit companies or project would prosper while the scammy ICOs won't get anything.
Even the countries currently banning ICO are making rules for investment.

There are already three projects doing the same or similar thing: Siacoin, Storj and Maidsafe.

I guess Filecoin investors never of heard of them or don't think much of them.

Didn't EOS raise some ridiculous amount? Or am I mis remembering? I know they had a long tail to their ICO.

Last time I checked was about a week ago and I think they've raised $230 million so far.

I think perhaps Filecoin is the first legitimate ICO legally issued to accredited investors on a crowd equity platform, thus it was probably snapped up and considered to be more professional and legitimate.


EOS Platform tokens are securities (https://steemit.com/cryptocurrency/@anonymint/re-h0bby1-re-anonymint-are-most-cryptocurrencies-doomed-to-collapse-because-they-re-ico-issued-20170904t001326092z) and very likely they have been illegal issued to USA non-accredited investors. I wouldn’t touch that hot potato. Could get delisted by the SEC and become illegal to trade.

Meaning if you are trading EOS Platform tokens, you may be committing a crime. This could come back to haunt you some years from now, when the regulators get around to it.


It was only sold to accredited investors. The token can not be traded. It is a restricted security.

Filecoin’s fundraising is not an ICO, in terms of what people around here think an ICO is.

With all die respect, $3,000,000 in 2 days is still a lot of money. That is nothing to frown over or look down upon, as you make it seem like it isn't a lot or something. Sure, it might be less than they were making, but it isn't exactly peanuts either. :P

Similar to savory coins that can be uploaded store in the cloud but is it as good as a coin that has a combination of digital money and data storage, because it uses a sharing system to many places..

what are the advantages of filecoin over projects like siacoin?

from the funding performance alone you would have to assume that filecoin is ALOT better but is it?

first time hear about this ICO. does this ICO have thread on bitcointalk

I don't think they care much about their presence on this forum, it is one of the most anticipated ICO in the space, good team and well funded by VCs, as you can see they have no issue raising significant amount of fund in the crowded ICO market

Government can't stop the development of blockchains , is $257 million  a new record for ico now ?Congratulations to Filecoin.

Regulators have flawed logic with regards to accredited investors (wealthier people). They think accredited investors are better investors. That is not true quite often and not true most of the time when it comes to technology.  Doctors and dentists do not know how to invest.  Surviving spouses may know nothing about business.  Celebrities are horrible investors. Real estate developers know less about technology than a basement dweller geek.

Regulators allow accredited investors to invest because regulators think that accredited investors can handle the loss.  This logic is flawed as well.  If a 65 year old, retired accredited investor loses 100% of his net worth, the rest of his life is screwed.  If a 20 year old, basement dweller geek loses 100% of his net worth, it's not that serious.


EOS rejected users with US IP addresses and forced users to acknowledge that they read the Purchase Agreement, which stated that US persons are not allowed to purchase.  I don't know if this will protect them sufficiently, but they did not solicit accredited or non-accredited investors from the U.S.

Just because you say so? Look at all the worthless ICO scams that people in our crypto ecosystem speculate on.

The main point is not that accredited investors are more astute, but that it limits the speculation on speculating about greater fools. The goal is all about limiting the liquidity (aka pumps) of scams. Because the securities are restricted and can’t be resold and traded, not until an IPO and restricted to trading on regulated exchanges. All these factors throttle the level of extremely wasteful and potentially catastrophic bubble/mania speculation nonsense that we see proliferating now in crypto.

Filecoin’s disadvantage is that with the tokens being issued as securities, they are restricted and can’t be traded on exchanges now and eventually after being registered then can only trade on registered exchanges and can never be spent P2P as a cryptocurrency. IOW, FIlecoin’s tokens aren’t a cryptocurrency.

ICOs are securities. And they will all become delisted and illegal to trade in the future, as the regulators in the nations slowly ramp up their enforcement actions.

Additionally those who are trading ICOs now, are doing illegal trading.

Those fools in our ecosystem are going to get their fingertips burned up to their armpits over time, as the regulators clawback, confiscate bank accounts, assets, and put people in jail. Mark my word.

Also legal securities issuance is not limited to accredited investors. There is crowdfunded equity (https://bitcointalk.org/index.php?topic=2146838.msg21616747#msg21616747) now.


We have multiple threads on this forum instructing investors how to bypass the IP address restriction by employing a VPN.

Also the SEC regulations apply to US persons, even when they are traveling abroad, thus IP address limitation is not sufficient by itself.

One of the requirements which EOS did not do is putting the ICO offering behind a firewall and allowing investors to self-certify that they are accredited is not sufficient:

http://archive.is/VWZCY

And even if EOS did comply with all those recommendations, that would only potentially absolve the culpability of the issuers to criminal and civil punishment. The tokens would still be classified as securities in any case. And securities have the problems listed above in bolded text.

Also the USA is not the only country that will be increasing their enforcement. EOS is going to be attacked by the regulators from numerous countries. Daniel Larimer has committed a very grave error. And anyone buying and trading EOS Platform tokens is committing a grave error that could come back to haunt them in the future. As of January 2017, the G20 countries have a cooperation agreement on financial crimes, taxation, and regulation. They will cooperate with each other on prosecuting those who have violated regulations in each nation-state. Those who offer securities willynilly as EOS and other ICOs have done, are going to be in a hell hole of trouble and woe. Maybe not immediately, but eventually.

Readers do not destroy yourselves by following the stupid herd. Consult an attorney and stop incriminating yourselves by being involved with illegal trading of securities.

Disclaimer: IANAL. This is not legal advice.

Not serious at all, Russia just came out with support, China ban is temporary. Space will hit $1T+ Market Cap next year.

You’re lying.

All these regulators in all the major nations will eventually force ICOs into regulated (or exempted) securities issuance, similar to Filecoin’s issuance. But the problem with that, is that the tokens issued as securities are then not freely tradeable.

All of those who are trading ICO-issued tokens now, are committing illegal trading. Proof-of-work issued tokens are not securities and thus not illegal to trade (this does not include scam issuance via instamines and sneaky/stealth mines).

Clawbacks, prosecutions, fines, and jail time are coming. Mark my word.

Seriously folks. Stop incriminating yourselves. Clean up your act now, so maybe the regulators will be lenient on you because at least you reformed yourself.

If a country bans these form of investments then they could charge the investors with money laundering and terrorism charges ,other than that expect these kind of rules and regulations because these ICO's are making millions of dollars without any obligation and it is time that the government disrupt this free flow of money and things might get tough in the future.

Exactly. TPTB let all the government-haters incriminate themselves, because they know they would be able to collect all the high-tech resistance movement (and silver and gold bugs) in one place and then destroy them as they collapse the global economy in next several years.

They will then come after all these people who form the resistance movement and simply confiscate all their assets with a charge of money laundering and throw them in jail for contempt-of-court without due process because they are aiding and abetting terrorists and refuse to provide the private keys for their crypto currency accounts.

It was a trap that the banksters laid. They know damn well the weaknesses of fools. They purposely looked the other way and told regulators to wait.

Folks disassociate yourselves from this immediately. During this past dip, I bought only honestly issued proof-of-work tokens and I have seen them all recover and moving towards new ATHs (slept and woke up and they are all crashed again). There is no need to be involved with the ICOs. They are likely to collapse and you will lose your investment over the next year.

Legally issued ICOs such as Filecoin are not a problem, except that remember the tokens are restricted and can not be traded until the issuer registers them with the regulators. And even after that, they can only be traded on a regulated exchange. Meaning they are just like stocks. You can’t spend them as a cryptocurrency P2P. If you do, you will be doing illegal trading.

Now the way around that dilemma is for Filecoin to issue other tokens which are not paid for. But they can’t issue said other tokens to those who participated in the ICO, because that would just be an obfuscation of the economic reality.

I think that the next max cap can be COMSA ICO. Not just because I advertise it at my signature but because it really strong project from japanese corporation with 3-year-experience, wonderful team which includes NEM devs and great business model.

I'm highly interested in this one.  I'm kind of unimpressed with Storj as a farmer.  I can't wait to see what they produce as a product and what they offer farmers.  

I always wonder why people need a lot of money for ICO. even without the chinese ban, what you think that they will do with our $257 million? Does this project really need a big amount of money to run? I do not think so. There are many small ICO but they can still successful

The equity securities regulation issues are a mess. For example this article will give you some idea how difficult it is to comply given international investors combined with US investors, and reporting requirements once it grows, and then think of the mess it will be to actually ever go IPO or reach a capital gain on your shares:

https://www.paulhastings.com/publications-items/details/?id=9c59e969-2334-6428-811c-ff00004cbded

If we go that route, we’ll likely end up in some regulatory or lawsuit “purgatory” (i.e. gridlock clusterfuck) down the line. It is a huge mess that we need to avoid.

I've also edited the following post to make it clear that I do not think the crowd equity paradigms are without problems:

https://bitcointalk.org/index.php?topic=2146838.msg21616747#msg21616747

I’m leaning away from equity as viable funding for decentralized ledger development.

Whereas, decentralized groups could raise their own equity for their own companies that develop (e.g. revenue generating apps) for a decentralized ledger ecosystem. Because they can form a small group selling to investors in one country.

I realize some others are thinking about obfuscations such as governance models like Dash’s scammy issuance of tokens to itself and then voting by themselves to pay themselves. I think that is way off target. The decentralized ledger (and its tokens) must be unencumbered from securities regulation. Over the long-term, all encumbered decentralized ledger tokens will be destroyed by regulatory action. They are not anti-fragile.


An interview about SAFT (https://etherreview.info/ether-review-legal-3-the-simple-agreement-for-future-tokens-4bc4671c044f) explains some of the issues, but do realize I disagree that the SAFT is a valid solution (https://bitcointalk.org/index.php?topic=2159815.msg21676934#msg21676934).

Yes, you are right! So is this the future of ICOs? Are accredited investors the only people allowed to invest money in the ICO before listing them in an exchange? Then why do they need a token? Why not follow the traditional way of funding a project?

Unless the big boys want to control the whole scam funding model to scam us.

I wasn't aware of that thanks for informing me i was afraid to invest in this ico because most according to me are considered scam because they simply fill up 50 pages and raise millions. About this project now I'm surely gonna hold it for long term siacoin is really slow but will recover slowly in the coming days or maybe weeks

never hear about that ICO before and this ICO world is crazy.

filecoin.io, you can find whitepaper on the front page.

I feel bad for Filecoin investors. They probability just dont understand how much money 257 Million is. This is a good example how you can influence others with good marketing.

If you think i'm lying than you clearly have no understanding of this space and what it is. Sure, States will attempt to regulate but this will fail over time and those that don't will thrive. There are no clawbacks with a blockchain, pandoras box has been opened.

This happening also popped up in my newsfeed in my browser and I had no words when I read it. The majority of the sale was bought out by big time investors and the ICO was exclusively available only for private investors. No wonder it made that much because of what they bring into the field.
It's going to be real cheap, cloud storage. No more high priced services like Dropbox and instead everyone will be able to trade coins in return for storage space which is a great idea. I can only see good going to a great height because of the well thought ideas.

how different is filecoin to stoj and maidsafe? are they not oing exactly the same thing?

I have been warning everyone that ICO-issued tokens (even if legally issued) can’t be traded or used as a cryptocurrency (https://bitcointalk.org/index.php?topic=2146838.msg21676563#msg21676563), because as securities they must only be traded on regulated exchanges.


Thus the SAFTs (https://www.google.com/search?q=Simple+Agreements+for+Future+Tokens) that were sold in the Filecoin ICO encumber the Filecoin tokes as securities. Thus the Filecoin tokens are useless and can’t be actually used decentralized (unless hypothetically the common enterprise ceases as explained below).

Quoted from the 1933 Securities Act:


Here are the narly details from an attorney:


(Edit: with the SAFT whitepaper now released (https://bitcointalk.org/index.php?topic=2208231.msg22902804#msg22902804), some of my former comments below may be inappropriate)

Damn right the SAFT is an investment contract where the expectation-of-profit is on the Filecoin tokens that will be issued to SAFT holders.

The Filecoin offering might be a legalese attempt to cheat. I’ve read this isn’t the first time that AngelList got themselves in trouble with the SEC.

Y Combinator’s SAFE concept (on which SAFT was modeled) doesn’t issue the participants some non-security. The SAFT is an attempt fool investors into thinking that it is on the same legal footing as the SAFE, but it is not.

AngelList can get away with this because they sold only to accredited investors and they buried a caveat in their prospectus, but the Filecoin tokens will never be legal to sell to investors decentralized until they’re registered (with sufficiently holding period of at least 3 years before resold the first time (http://scholarlycommons.law.wlu.edu/cgi/viewcontent.cgi?article=1743&context=wlulr#page=8)), or hypothetically until those tokens stop being securities because there is no longer an investment contract under the Howey test, which could be when the investors no longer rely on a (pooled if “horizontal commonality” is the assumed definition of a) common enterprise for their profit expectation or presumably in the cases where the tokens are spent on bona fide goods or services rather than sold to an investor (but the same tokens in theory become securities again if sold to an investor where the investors’ profit expectation relies on a said common enterprise).


My analysis about “use value” tokens being irrelevant (https://bitcointalk.org/index.php?topic=2156492.msg21615589#msg21615589) to the issues that the Howey Test looks at, agrees with the attorney I am quoting here.

It doesn’t matter that the SAFTs can be speculated on and that the separate Filecoin tokens have some utility other than as speculations, the Howey Test only requires that the investors have an expectation-of-profit in a common enterprise managed by the others (typically the issuer), and the security is the investment contract certificate that records who receives the gains. Any obfuscations which attempt to circumvent the intent of the law, which is that securities must always be registered and trade on registered examples, are invalid under the Howey Test. There is no way to convert a security into a non-security (except as aforementioned the common enterprise ceases), because that would circumvent the entire point of the law. The investors are not investing in SAFTs but in the Filecoin tokens they receive for the SAFTs. Without the Filecoin tokens, the SAFTs are worthless. The Howey Test states it will always look at the economic reality and ignore any tricks that attempt to obfuscate the economic reality.


If the SEC announces that AngelList’s prospectus is misleading and orders it to be refunded, that could have another big hit on expectations in our crypto ecosystem. More “bad news” is coming eventually.


Trading in ICO-issued tokens is encumbering YOU with potential long-tail legal woes that come at you from many different regulatory bodies, statutes, and nations. It is jurisdictional hell. Stay away from this!


Promoting ICOs makes you an affiliate. Which means you have severe fines and even jail time awaiting you in the future.

You may be in a some 2nd or 3rd world country and think you are out-of-reach of such regulatory crackdown. But those G20 can still find a way to take your assets and arrest you. That is if you use an international wires, travel internationally, etc.. They may also in the future pressure your government to acquiesce to enforcement as the USA has achieved with FATCA worldwide.

EDIT: since writing this post, I have recently analysed the securities implications in more detail (https://bitcointalk.org/index.php?topic=2208231.msg22330424#msg22330424).

Disclaimer: IANAL. This is not legal advice.

With that amount of money gathered from their ICO, they should have updates posted for it within days of launching the coin. There is so much things that someone can do with that much money, 257 million dollars can be used to hire a huge amount of developers that can build the project and expand it without the money in the budget being affected by it. They wouldn’t even need a million dollars to get people interested in working with them, so it should be interesting to see how much longer they will wait till they release something ground-breaking and disrupt virtual currencies.

You know of course that most (or a very significant portion) of the money ends up in the pockets for those who organized this, not in R&D.

The tragedy-of-the-commons in fundraising (https://bitcointalk.org/index.php?topic=2159508.msg21677192#msg21677192), means that it will always be a slush fund for the crocodiles and bureaucracy.

It’s a tragedy-of-the-commons no matter if it is regulated or unregulated. The top-down control — required to enforce regulation to prevent South Seas Bubbles wherein people are not dumb to invest in worthless shit (https://bitcointalk.org/index.php?topic=2159508.msg21677192#msg21677192) — enables crocodiles to take most of the fundraising for themselves.

ICOs are the antithesis of decentralized. They’re the antithesis of what some of us ideologically dedicated folks want to achieve.


Not for R&D.

If you're 25 now and invested in this. Good luck getting a 10X ROI or nothing at all by the time you have a grandson.  ;D

Record breaking Crypto-Pyramid Scheme ?
Shocked  :D

What do they need a quarter billion dollars for again ?

A quick check on the Internet shows that Dropbox ( the company) was valued at 10 Billion dollars in 2014.  $250 million for a startup competing in that space doesn't seem totally out of line, to me.

That is fucking retarded fail.


https://coinmarketcap.com/

Amount from the Bitcoin ICO ?

0 Dollars and 0 cents.  ::)

Such ICO's and such funds says one only - many people wanting to catch fish in troubled waters. For what project need s such budget I don't understand. Real company with real product collect much smaller funds and do own product.
Imho soon big fund raising will be equal scam or projects from which to stay away

Exactly.. why do they need a quarter billion dollars ?

Wish  a "follow"  feature is available on this forum.. need lots of like minded folks to follow. We need to be organized. The way things are going these days is unbelievable. Cryptocurrency is about Decentralization, non- crypto fans need to respect this and leave us alone.