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Author Topic: can someone explain why so many ICO's are scams?  (Read 286 times)
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March 26, 2018, 04:23:28 PM
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All I hear about is that ICOs are scams and you need to watch out... Can someone explain why so many of these things are scams? What percentage do you think are legit businesses?
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March 26, 2018, 04:30:19 PM
 #2

What do you not understand about the concept? People pay a lot of BTC/ETH for ICOs; usually even without doing any research, people just go in based on hype. So scammers created scam ICOs to make money off people. Pretty simple, really.

I'd say, probably only 7% of projects have real teams with real goals. and only a fraction of that percentage has a chance of succeeding. Take note that these are just numbers that are very rough estimates of mine.

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March 26, 2018, 04:56:45 PM
 #3

Well it is easy way to earn money instead of a hard work and thieves found a new way to steal money. Just fool people with great project ideas let them invest etcs,btcs take the money and then vanish.

Everyone is dreaming to be rich without work and investing their money to projects without research it properly. In Turkey a 25 years old boy just fooled people with livestock project said "In a year you will earn twice of your invest" Turkish people invested 100 million USD to project. Boy took the money and run to Uruguay which dont have any diplomatical agreement with Turkey. Thieves like that always be there and best way to avoid them is detailed research.
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March 26, 2018, 11:19:44 PM
 #4

You also need to keep in mind that even IF an ICO isn't a scam, that doesn't mean it will be successful.
Here, have a look at https://www.tokendata.io/ and click on 'Status' and let it sort by 'FAILED'. You'll be amazed at how many ICOs rais money, aren't successful and fail miserably.

So, please be careful and DYOR! If you want to invest in an ICO, research it thoroughly, don't invest what you can't lose and diversify (don't invest everything in one project) - make an exit plan.
As I said before, ask yourself this before you invest:

  • Do I understand how the investment works?
  • What are your goals?
  • What level of involvement is required?
  • What are the risks of this investment?
  • How much do you expect to earn on this investment (ROI)?
  • How long do you plan to invest? Is this a short-, medium- or long-term investment?
  • What are the costs to buy, hold and sell the investment?
  • Is there a clear exit strategy?

Be safe Smiley

And just to give you an idea about the money involved, from captainaltcoin.com:
Quote


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March 27, 2018, 05:28:06 AM
 #5

Pretty much anyone can start ICOs, and with little consequence to boot, and therein lies the problem. It's an easily exploitable model, which would have otherwise been a legitimately fresh way to raise funds, except it has already been overrun with scammers. It doesn't help that it's done on a cryptocurrency platform, which happens to be the hottest new "investment" at the moment, which means it can also take advantage of people's FOMO, along with the ease of investing.

I honestly can't tell what percentage of them are legit, but I probably won't be too far off by saying around 1%.

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March 27, 2018, 11:11:34 AM
 #6

Only a very low percentage of the ICOs is real. Majority of the them only come to sell idea to us without the intentions to execute it. The moment they rake in the money, they pretend to be working on the project. Meanwhile, they are already working out their exit. There is so much of this due to lack of regulations.


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March 27, 2018, 12:18:15 PM
 #7

You also need to keep in mind that even IF an ICO isn't a scam, that doesn't mean it will be successful.
Here, have a look at https://www.tokendata.io/ and click on 'Status' and let it sort by 'FAILED'. You'll be amazed at how many ICOs rais money, aren't successful and fail miserably.

So, please be careful and DYOR! If you want to invest in an ICO, research it thoroughly, don't invest what you can't lose and diversify (don't invest everything in one project) - make an exit plan.
As I said before, ask yourself this before you invest:

  • Do I understand how the investment works?
  • What are your goals?
  • What level of involvement is required?
  • What are the risks of this investment?
  • How much do you expect to earn on this investment (ROI)?
  • How long do you plan to invest? Is this a short-, medium- or long-term investment?
  • What are the costs to buy, hold and sell the investment?
  • Is there a clear exit strategy?

Be safe Smiley

And just to give you an idea about the money involved, from captainaltcoin.com:
Quote



This is the best piece of advice when investigating into a ICO you want to invest in. The biggest things these days is that ICOs love to do an exit scam just like bitconnect and USI TECH is getting there as well!


But good news is when regulations come this will clean up the crypto space.

Also alot of people think that because these mainstream media sites are banning ICO ads means that they are anti-crypto, this isnt true.
They are actually helping the crypto space by doing this, they cant possible clean up and investigate each one individually so the only option for them to do as of right now is to ban all of them all together!

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March 27, 2018, 05:10:05 PM
 #8

The main issue with ICOs is that they are very easy to set up. The projects they supposedly back are not so easy to implement. It takes discipline, time, effort, and resources to actually follow through with the great idea. For this reason, even the well intentioned ones can end up failing because they plain don't have the follow through.

In my opinion, the best way to protect yourself from investing in an ICO that either was a scam to begin with or tried and failed is to get to know deeply one or two solid projects. From there you can get a sense of what it takes to actually carry out a successful complicated cutting edge project. When you are familiar with the winners, you'll be able to rule out the losers before putting any money into them.

I know of three truly solid projects going on in the cryptospace right now. I'm not saying they're the only ones by any means. They are ones I know about. I'm going to link to each one's thread. I encourage you to get to know these projects (regardless of whether or not you decide to get involved in any way), study them, and use them as a way to develop your own standards for how to judge whether or not a new project has real work and deliverables backing it up, or if it's all talk and hype. It can be extremely difficult to properly discern that, but it is necessary.

If you happened to have gotten burned on an ICO that never delivered (I've been there!), try to get past the sense of embarrassment and loss you undoubtedly feel and try to identify what you might have missed and why. Were there some glaring red flags you ignored? What were they? Did the development team consistently miss deadlines and then gave all kinds of incomprehensible reasons that sounded good? Were you outright lied to? The failures can also help you learn. Most importantly, how did the bad ICO differ from what goes on in a solid project?

OK, here are the solid projects:
DNotes
DMD Diamond
NEM (Unlike DNotes and DMD Diamond, the NEM forum thread is not a main place where the devs disseminate information. You'll need to get on the appropriate Telegram channels for that info).
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March 27, 2018, 05:21:54 PM
 #9

Because as of now the industry is highly unregulated. Knowing this and knowing that many people will not exercise their due diligence and research thoroughly into projects before investing, the scammers will scam. If there's a market to exploit, in this case being desperate or naive investors, there will always be bad people who will look to take advantage. This goes for the whole crypto space (not just ICO's) and all traditional financial markets--just do a general search of ponzi schemes and you'll see that these sorts of practices have been around forever. One rule of thumb to remember when looking into ICO's is that whenever 'Guaranteed Profits' are touted, stay clear.

Feel free to check out our piece on ICO best practices on our blog: https://www.mintdice.com/blog/want-to-join-an-ico-heres-what-you-need-to-know

Cheers!

Mintdice.com
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March 27, 2018, 05:23:05 PM
 #10

I beg to differ with the opinion that all ICOs are scam. Yes, there are some clever guys who want to make some quick money. Then they are assisted by some people who invest blindly with the hope that their money will grow 10 times in 10 days. So hyper expectation is a major reason for scams. I strongly believe there are still plenty of projects that are worthy of crowdfunding and have very bright  prospect. But the investors need to be picky. Do your research before investing, inquire the ability of the team- these little activities can make a safe investment with lesser chance of scams.
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March 27, 2018, 06:32:26 PM
 #11

Not all ICOs are scams, but yet some are. Some icos are scams because people make money very easy like that. They let people invest and collect their money but then the ico never continues from there on. People need to be sure to do their research before investing in any ico!!
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March 27, 2018, 10:51:43 PM
 #12

Oh, yes there on coinmarketcap scammers is 90% of all projects. It is possible for years to maintain the course of a coin, simply giving out occasional news. They will write that things are going well, they all work and that it takes many more years because the crypto currency is such a complicated thing. Same and from the road map will lag behind and write that there were difficulties but everything will be done
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March 27, 2018, 11:03:32 PM
 #13

All I hear about is that ICOs are scams and you need to watch out... Can someone explain why so many of these things are scams? What percentage do you think are legit businesses?

very few are legit business, not also legit or not but many times there are very bad projects without whitepaper, or without developers
just thimk about it
in order to set up a ICO you need money and a website

before investing in ICO study a lot and analize the team behind it, the community etcetc

Here a good article I found about scams:
https://medium.com/@CryptoTutor/famous-scams-in-the-cryptomarket-623e0ef53b60

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March 27, 2018, 11:22:05 PM
 #14

Most ICOs are scam because they are not regulated by anyone and anyone can start an ICO to scam people.

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March 28, 2018, 10:49:40 AM
 #15

ICO's are not regulated yet. They most certainly will be, it's just a matter of time. Unfortunately history (and reality) show that if no regulation exists, people will try sinister things just to get a lot of money. And with ICO's, there are a lot of people that are willing to invest their cash without having the ability to do proper research or analysis whether a coin is good investments. This makes them (unfortunately) the perfect prey for scammers.
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March 28, 2018, 11:54:56 AM
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Oh, yes there on coinmarketcap scammers is 90% of all projects. It is possible for years to maintain the course of a coin, simply giving out occasional news. They will write that things are going well, they all work and that it takes many more years because the crypto currency is such a complicated thing. Same and from the road map will lag behind and write that there were difficulties but everything will be done



Have you heard about the CMC SCAM???

if its true or not?


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March 28, 2018, 12:20:13 PM
 #17

So many ICO's are scam and few legit projects. You only have to do is to make a deep research, analize it carefully and read some past reviews about the project they made if successful. Have enough knowledge before investing in any ICO's.
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March 28, 2018, 12:25:39 PM
 #18

I think that most ICO'S are not scams, it's just often may be shortcomings in understanding the idea, how the project works, inaccurate calculations, not enough analytics, not having enough time to prepare, unskilled employers.

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March 28, 2018, 02:10:54 PM
 #19

You will find out at the end of the day that only very few of the numerous ICOs announced are real. Some came with good intentions but their project failed because they have no well throughout plan and did not put their idea to test. Some are outright scam. They just come to deceive and take your money, shutdown and disappear afterwards, knowing fully well that you can't trace them because there is no regulation.

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March 28, 2018, 02:30:20 PM
 #20

People who are beginners and want to make massive returns in short periods are very gullible.
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