Bitcoin Forum

Hey everyone,

I am the only one noticing all of the ERC20 token scams on the ethereum network. How is this going to effect the network? It looks like price is breaking down from ether being siphoned out of the system by these scams.

Thanks,
CoinChaos

The real negative issue with Ethereum-based scams isn't that the scams themselves siphon up ether--that's effectively indistinguishable from any other market activity, legitimate or otherwise. The problem arises when people new to crypto lose money in a scam and are then forever turned off from the market, in the process telling anyone who will listen about how they got scammed out of ether.

The best thing we legitimate users of the Ethereum ecosystem can do is shine as much light as possible on scams so as to protect new/naive users from losing their hard-earned money.

Around 80% of all current projects in crypto are based on the ethereum network. Of course you will have both really good projects and scams,I don't see it as a liability

You are not only the one who do notice such thing but most people is already aware on this kind of situation which is happening on ETH ecosystem and i do really believe it does really affect ETH value because of these scam tokens which some people can easily make their own coin and later on they do dump as long they would able to secure some nasty profits from their project.

What is wrong if there are so many dead / scam tokens? Ethereum looses nothing from them. It provide a smartcontract/blockchain. But how can they guarantee that tokens will not be a scam

Yes, these scams are very bad for the system. Ethereum was suppose to be a trustless system. Now we have all these tokens that are created and controlled by anyone who wants to make them. It is way to easy.... anyone can do it with a little ether. I think ethereum is a trust network. You need to trust the network and the code, but not the person, well sometimes you need to trust people or corps. You really need to be able to understand the token and the corp. or person behind it, because there is a corp. or person behind it. I guess in this beginning before the system is fully understood we will see this, but hopefully we will get the community educated(me) and maybe get a credit score going for these tokens.

The scam tokens might hurt the tech indirectly:

People will distrust, oppose and regulate technology precisely because it is being [or can be] misused.

We [the early adopters, tech proponents, developers, cryptocurrency media] and are not the ones who will make the laws based on fears, hidden agenda or because lots of people get scammed.

What we can do is to create as much "trust space" as possible. We need to advocate for caution, build trustworthy ICO scoring websites, publish guides, educate. We basically need to outnumber the scammers and try to marginalize their activity within the most probable channels where people will start learning about Ethereum, smart contract and cryptocurrencies in general.

it's not just the network, it's all of crypto that's affected. you can't pump out a lake of shit and not have the authorities pick up on it. we've already seen some effects such as china and there'll be more.

Yup, I heard the news about ICOS in china and now I see why.

I dont think that the price is falling because of some scam tokens. We had much scam in the last time, but thats not the impact at eth price. Its just falling, because BTC struggles a little bit because of the fork action.

The only negative thing i caj think about is that if a great number of people gets scammed a lot of times and happens to lose a whole lot of money due to this scams, then i think this will cause them to spread a lot of negative things not only about etherium but on Bitcoins also and the whole crypto world as a whole. And this will really make other people looking into jumping into the crypto world turn a hundred and eighty degrees away from crypto currencies and help spread the negativity which can the be very bad for the crypto world.

Ethereum offers thousand of possibilities to create sustainable and profitable platforms, but this advantage is also an open door for thousand of fraudulent projects. Sooner or later investors will be more aware of what is a real project or a scam, just as in real life. In any case scam will always exist.

I don't think it's a problem for ETH particularly, but a problem for crypto in general. This is why regulation could be a good thing - and it has to happen in any case if we are to have mainstream adoption of crypto. Better that regulation comes sooner rather than later as the scams are damaging to the image of the industry in general.