The ugly side of Altcoins - what is our responsibility?

[Altoidnerd]

The altcoin markets are a lot of fun.  It's like cyber forex, and is easy to navigate for people who have been with bitcoin in the first place.

I am starting to see some very fast moving trends that make me feel sorry for buyers of "new coins" that are doing so because they believe there is promise of a great investment.

Some of what I am seeing is quite sad.  Take for instance QRK who is using subliminal captchas

(I collected and documented this here http://altoidnerd.com/2013/12/12/quark-trying-super-hard-to-sell-me-their-coin-with-subliminal-captcha/  )

to sell QRK to people whom I suspect could not distinguish a base-2 number from a base-58 number.  This is starting to create a dark vaccuum in the crypto currency movement as a whole.  There is a faction of "look the other way and take QRK profits proponents" who align with powerful people and communicate broadly with twitter that QRK is the next bitcoin.

QRK is not the only one and I am not about to begin the list, nor is this an attempt to single our QRK.  The questions are:

• am I alone in thinking there is a distinction between "man made" quickly distributed, heavily marketed coins that are essentially sold to the lesser informed and quietly, naturally developing cryptocoins with healthy economies?

• what CAN we even do about it?  We can talk about it openly, but it's my word vs Max Keiser

• am I correct in sensing the first strict regulations may come in a response to any backlash from any "scamcoins" - consumer fraud?  I don't know - I can tell you people are being led astray.  They are being tricked.  These coins are not all the same.  What to do...

I can barely watch the hype machine any longer.  I imagine a family member, uninformed of course (who else IS informed?) taking a "position" in protoshares and I want to hit someone.  It brings me sorrow as a human to watch this darkness unfold...

Or do we just chill and play with our bitcoins?

[coinrevo]

well, any CC that uses marketing or is closed source is scam, obviously. what did Max Screaming Keiser say on the topic?

[StewartJ]

Right now, any developer and/or miner can premine a billion coins, hype and pump them with marketing
and then dump them on Cryptsy.  Then rinse and repeat with yet another coin with a cool name and logo.

We need to have a "standard" for genuinely innovative coins versus pump-and-dump scam coins.

If there was a thread or web site dedicated to sorting out the I-want-to-steal-your-BTC coins versus the
the more legitimate ones, that would be a great asset to the Alt Coin community.

[Nullu]

Right now, any developer and/or miner can premine a billion coins, hype and pump them with marketing
and then dump them on Cryptsy.  Then rinse and repeat with yet another coin with a cool name and logo.

We need to have a "standard" for genuinely innovative coins versus pump-and-dump scam coins.

If there was a thread or web site dedicated to sorting out the I-want-to-steal-your-BTC coins versus the
the more legitimate ones, that would be a great asset to the Alt Coin community.

Maybe the exchanges need to take a little responsibility too. Mooncoin was listed in a day. A day. Everyone in the chain is supporting the status quo because it is possible; the forum, the miners, the sellers, the buyers, and the exchanges.

It would be nice to have some way to rate/slate new coins, but that again is going to be biased depending on where you are in the chain, and what it is that you're holding.

[StewartJ]

Making this a Sticky Thread on the alt forum here will go along way towards helping us sort out the coins.

https://bitcointalk.org/index.php?topic=370807.0

[kalus]

Making this a Sticky Thread on the alt forum here will go along way towards helping us sort out the coins.

https://bitcointalk.org/index.php?topic=370807.0

i like how the op of that thread has a -4 trust himself.  

anyway, that list could easily be abused by someone with a vendetta against a particular coin or dev.

also, this list basically resembles 90% of the alt coin forums. 

[carlb007]

Right now, any developer and/or miner can premine a billion coins, hype and pump them with marketing
and then dump them on Cryptsy.  Then rinse and repeat with yet another coin with a cool name and logo.

We need to have a "standard" for genuinely innovative coins versus pump-and-dump scam coins.

If there was a thread or web site dedicated to sorting out the I-want-to-steal-your-BTC coins versus the
the more legitimate ones, that would be a great asset to the Alt Coin community.

Maybe the exchanges need to take a little responsibility too. Mooncoin was listed in a day. A day. Everyone in the chain is supporting the status quo because it is possible; the forum, the miners, the sellers, the buyers, and the exchanges.

It would be nice to have some way to rate/slate new coins, but that again is going to be biased depending on where you are in the chain, and what it is that you're holding.

This.
If coins like Moon and EAC didnt get put onto exchanges in an instant i dont think the issue would be anywhere near as bad. If people saw that 99% of new coins being released dont make it to exchange then the majority would stay away from them until they actually turned into something. But right now its monkey see, monkey do. You almost feel like you have to at least stick a couple of hours mining on anything regardless of how much you hate it just because you know youll be able to dump it within a week.

Its impossible to really rate coins because like you say everyone has their preferences and thats fine. Some people like something for the same reason that someone else may hate it. But i do think if a coin is premined in any way, it should be automatically given a 6 month wait time for the exchanges or something of the sort. I absolutely do not buy any reason given for premining coins.

[Doges]

Doge is dead. Rest will follow. Only the stronk will survive.

Responsibility is to use common sense and not support bad coins.

[black_swan]

Right now, any developer and/or miner can premine a billion coins, hype and pump them with marketing
and then dump them on Cryptsy.  Then rinse and repeat with yet another coin with a cool name and logo.

We need to have a "standard" for genuinely innovative coins versus pump-and-dump scam coins.

If there was a thread or web site dedicated to sorting out the I-want-to-steal-your-BTC coins versus the
the more legitimate ones, that would be a great asset to the Alt Coin community.

Maybe the exchanges need to take a little responsibility too. Mooncoin was listed in a day. A day. Everyone in the chain is supporting the status quo because it is possible; the forum, the miners, the sellers, the buyers, and the exchanges.

It would be nice to have some way to rate/slate new coins, but that again is going to be biased depending on where you are in the chain, and what it is that you're holding.

The only problem in this system are the buyers, stop buying shit and people will stop mining it rather quickly.
early adopter greed > anything else

[fasteddie9987]

There is a responsibility to the buyer through common sense but the first failings begin at school really.  There should really be education from a young age about basic life skills and education as a whole should cover far more important topics.  For example, does anyone ever remember any science lessons on Nikola Tesla at school?   It's also hard for people to put into context the value of all these new alt currencies and shares etc if you don't have a real understanding of "money" as this is also not taught in schools. For most people the history of banking and how money is really issued etc is an alien concept and not one most people seem that bothered about unfortunately.  

[atp1916]

These types of posts are almost always made by someone who has little or no hash and could wish he/she were on it.  Because you can't profit, you must keep the rest of us from it?

Get some mining gear and hop into the pool.  Your opinion will quickly change.

[markm]

Usually it is only the scam-exchanges that specialise in getting as many scams in front of as many suckers as possible as fast as possible that list new coins fast, isn't it?

So maybe it is simpler to just warn against those exchanges instead of worrying about each coin?

-MarkM-

[black_swan]

Completely disagree. I hate prohibitionism
Use your brain or lose your money, nobody forced people to buy anything

[bitrebel]

There are 1000 currencies in this world, and most people use the dollar.
It will be the same with Alts

[Bfljosh]

Hard failures give valuable lessons.

[markm]

I am not suggesting prohibition. Just tell people plainly that if they are into scams and want to participate in scamming people there are exchanges that specialise in that so go play in those exchanges.

Meanwhile try to find an exchange you can mention to friends without feeling like you are sending them out to get scammed.

In Canada we have CAvirtex which handles only Bitcoin and CAD, that seems maybe a little more conservative than most people here would prefer I expect.

There is also Vault of Satoshi, I guess it is time to see what else they carry besides Bitcoin and CAD, although I have found they are insanely hard to get clearance for since they are doing things like asking for two photo IDs, which no one in Canada even has unless they are globe-trotters thus equipped with a passport.

Though they also are inconsistent with that; after much argument with them over email they now claim a credit card or birth certificate will do as a second ID even though they don't have photos on them.

I have been using Vircurex so far, but when they suddenly listed DOGE that worried me a lot, then the fact they seemingly were not listing DOGE to replace one of the other scrypt coins that has even more pathetic hashrate thus even more vulnerability than DOGE that worried me even more. Are they too going to end up flooded with crap, if only by not dropping the crappiest of the scrypt coins they had when finding a more secure one (higher hashing power) to replace it with?

Any other exchanges that maybe have a few very carefully chosen altcoins instead of letting themselves get lobbied by scammers into adding scamcoins just to make a buck out of fooling the uninformed into buying into blockchains that are not secure and probably never will be secure?

-MarkM-

[FrictionlessCoin]

I am not suggesting prohibition. Just tell people plainly that if they are into scams and want to participate in scamming people there are exchanges that specialise in that so go play in those exchanges.

Meanwhile try to find an exchange you can mention to friends without feeling like you are sending them out to get scammed.

In Canada we have CAvirtex which handles only Bitcoin and CAD, that seems maybe a little more conservative than most people here would prefer I expect.

There is also Vault of Satoshi, I guess it is time to see what else they carry besides Bitcoin and CAD, although I have found they are insanely hard to get clearance for since they are doing things like asking for two photo IDs, which no one in Canada even has unless they are globe-trotters thus equipped with a passport.

Though they also are inconsistent with that; after much argument with them over email they now claim a credit card or birth certificate will do as a second ID even though they don't have photos on them.

I have been using Vircurex so far, but when they suddenly listed DOGE that worried me a lot, then the fact they seemingly were not listing DOGE to replace one of the other scrypt coins that has even more pathetic hashrate thus even more vulnerability than DOGE that worried me even more. Are they too going to end up flooded with crap, if only by not dropping the crappiest of the scrypt coins they had when finding a more secure one (higher hashing power) to replace it with?

Any other exchanges that maybe have a few very carefully chosen altcoins instead of letting themselves get lobbied by scammers into adding scamcoins just to make a buck out of fooling the uninformed into buying into blockchains that are not secure and probably never will be secure?

-MarkM-

In fairness to Vircurex,  Vircurex typically looks at hash rate to determine inclusion.  DOGE had a high hash rate (probably #3 among all scrypt cois).   


Is DOGE a good investment.  of course not.   


So maybe hash rate is not enough... maybe the coin should be around for at least 6 months prior to listing.


Amyway, the responsibility falls on the exchanges to ensure the quality of the coins they trade.   


Of course, that doesn't prevent stuff like NXT that create their own exchanges!

[nurminen1]

This is life, not Harry Potter.

[markm]

Actually VIrcurex replied to my panic email about what a horror it was to see yet another garbage coin on Vircurex that it was high volume that made it attractive. A lot of the coins on Vircurex are reasonable seeming coins but have rather low volume. Maybe because there is way the heck more volume in scamming the masses than there is in selling them only the best of the best.

I wish they would drop Feathercoin and Worldcoin, since DOGE demonstrated that almost overnight an internet meme could conjure up way more than enough hash power to PWN them both.

-MarkM-

[FrictionlessCoin]

Actually VIrcurex replied to my panic email about what a horror it was to see yet another garbage coin on Vircurex that it was high volume that made it attractive. A lot of the coins on Vircurex are reasonable seeming coins but have rather low volume. Maybe because there is way the heck more volume in scamming the masses than there is in selling them only the best of the best.

I wish they would drop Feathercoin and Worldcoin, since DOGE demosntrated that almost overnight an internet meme could conjure up enough hash power to PWN them both.

-MarkM-

There are stock exchanges that trade penny stocks of completely dubious value. 

I guess it works the same,  if an exchange values its reputation, then its up to them to decide what goes in or not.

Also, if folks are so into the lure of early adopter status,  then let them take the ridiculous risks.

The coin I develop (iXcoin) isn't as popular as many other coins, but at least it has a very secure hash rate and is extremely mature (2 1/2 years old).  I certainly wish for more liquidity but I think long term it will eventually come.