Bitcoin Forum

To my understanding company do ICo  to raise funds to start up their project !! But  most project listed their token on exchange after the ICO and forget about the mean project  and got away with investors money  . Why all this is happen  ?

Well scams are everywhere in every walk of life and field of business we should stay vigilant and well connected with forums and news outlets to know if there is something wrong with some projects and then can avoid investing in them. Secondly i also agree that sometimes there are projects that seem to be good but the development remains slow and it takes them months to even post an update regarding the state of the project which usually annoys the investors and supporters and indirectly this sluggishness discourages investors resulting in dumps and loss of interest and value of the project untill the product is launched.

This happens, mostly because there is no regulations and smartcontracts aren't still used in a way to protect investors.

 Daico, for example, theoretically would allow companies to withdrawal money from the ico only when they have completed certain parts of the roadmap.

Regulations can still protect investors...

On the other hand there are many honest people out there, really working with the money raised on the Ico

So, ico are both : new way to sell shares, and new way to scam.

I think both answers are correct. At present it is very difficult to recognize a real project from an idea that was created just to collect money and disappear. Therefore, before investing money, the most important thing is to make very detailed research about ICO where we want invest.

maybe because they waited until the market grew to start development or maybe they were all scammers who had left their projects after listing in the market

Because when people see large sums of money in front of them, they forget about everything and they are not interested in anything. They only think about how to spend this big money.

Both. If you are investing in a legal project, you are going to be a shareholder of that project. But in case, you invest in a scam ICO, you will lose everything. So, no one can tell it as good or bad before you having an analysis on a particular ICO. We have witnessed a lot of good projects have been come with ICO, for ex. ETH.

Because of the lack of effective legal regulation in the cryptocurrency market, fraudsters can create scams without fear, but real ICO projects still exist.

This is another type of scam. Most people think about the scam is someone run away after raising funds. But it's not, because most ICO project listing their coin or token in small volume exchanges. This is not a good thing for investors. Because they are not getting a good return on investment. With those problems, choosing an ICO project is a hard thing. Then do your own research before investing in ICO projects.

This is the reason why ICOs have been banned in some countries while others are enforcing regulation and KYC. However, the KYC and other checks needs to be done on the team running the ICO rather than the investor to ensure that the project is legit.

it is more like the old way of scamming people since there is nothing new about it. not just because it has been around for a while now but also because the method is pretty similar and over used method of creating an illusion and advertising something fake to fool people into buying it and then profiting from their gullibility.
it is just now in form of cryptocurrencies and has certain anonymity that helps the scammers to get away with stuff.

Because these are scam projects, their purpose is not to develop a product but to get money from investors. Sadly, most projects are like that.

It is because their main intention is to scam people. They are just making a project to gain a profit for their own then run away from the project. That is why ICO investments are very risky and require a careful effort to research and analysis to be able to make a profitable investment.

Of course it's easy the answer is to earn easily. That's the new method of scamming (It's not clnsidered a scam) but it's like that they will going to create a project that sounds very promising and after that they will list it on an exchange with a low volume and that's it... you'll not gonna hear any improvement from the project again.

For me a good project is that:
• They're ransparent they give every detailed information and solution about that project and how they're going to implement it.
• They give complete infos about the companies location hotline, etc.
• Soft copy of the legal papers
• Compelete name and other infos of each members
• They will use the ICO funds to continue the project to make it successful
• Before they list the coins to exchange, they make sure that the project is complete or atleast working so many new investors will going to buy the project.

In the realm of crypto and real, we are not separated from discovery, in various ways it will be done to be able to eat prey.
It is indeed difficult to avoid but we will be vigilant and learn a lot in order to be spared.

The next step of ICO development is rising of STOs (secure token offering). They should be regulated and I'd like to think that it will help to get rid of such amount of shitcoins and crappy projects on the market.

it is because they dont want to continue the project after they collect funds from the investors, that is the reason why many ICO team cant be reach after the success, they will just sell their ideas and after people believe in them thru investing they will abandon their project and also the investors. Government should be the middleman thru the laws they must create to protect investors.

well you could say 90% of all ico's last scammed investors.. I recall I ran into more scam ico's them the legit ones that actually has something to offer

It is a way for companies to sell shares to investors which also is being used as a new way of scam.
Companies have a wide range of reason for choosing ICO than other options, one of the being low regulation and low accountability.

Thats true and most cased that still happen til today! ICO's today has 2 faces the one is from the real and working start ups and the other one is just a front for scams, and way to take advantage and robbed the investors money that no one can predict when! thats why stay vigilant when investing in any ICO specially when it was shady and hiding in the dark ICO's and other crowdfunding activities! ICO regulation is needed to make it more secure for everyone specially investors.

A bit of both. First you need to understand not all companies succeed, so just because one company makes an ICO and than starts to go bankrupt and not give you what you were promised doesn't mean they are scammers, I have seen many coins and been part of a lot of them from inside to know that some of these coins just go bankrupt because they fail to do what they think they would do. However, of course there are scammers too which is why securities tokens will be a bigger thing in the future and instead of ICO we will have STO soon.

Without the failing part though, ICO is also a part of new way for companies to sell shares not to resemble the IPO in nasdaq or nyse style but more like to angel investors, instead of giving away 10% to some silicon valley angel investor, they give it to the customer and start the company up, IPO is more like a currently established company to get even bigger, ICO is a company that doesn't exists but will with enough funds.

I Really understand your explanation we all know starting up a company  is very challenging and sometime team manager go to exchange to dump some tokens   .. ICO is the best way for investor and company too  because with ICO u can invest as little as  $100 in a project but the Scammer are tarnishing the image  of ICO ..     

No, ICO is just a new, more effective way of raising startups' capital. They do not sell their shares. That's only true for STOs, that will be popular this year.

It seems that most ICO companies are very close to scam. Although they may have some legal qualifications, those qualifications only prove that they are a legitimate company. In fact, whether it is legal or not, it can be financed through ICO and they can still post fake icos.

I've yet to see an ICO where tokens actually represent shares. It's difficult legally, although we're seeing progress.
Not representing shares does not mean that ICO-s are scams though. There's plenty of other legitimate uses of tokens.
I bet you've never read a ToS on an ICO.

That is why now it is even more difficult for an investor to choose the right ICO with good returns. Ineffective legal regulation, lack of due checks of the commanding staff of developers attracts fraudsters and annoys investors

Most of these ICO projects were created to grab money from unsuspecting users. They created a good front to cover their greed for money. People should watch out for these deceitful projects and learn how to identify one.

It was ordinarily supposed to be a way of sharing their stocks not necessarily shares to investors. But now, it is plagued by huge scam everywhere.