ICO Exit scams have stolen more than 100M USD

[Mulbuggie]

I think the main problem is the people who invest in project without knowing accurate information about it. Many people think only investing will make them rich. But actually is far more than investment.

[hisori]

According to this news I read, is this the end of of ICO? Kindly read through and give your opinion
The cryptocurrency industry may be maturing, but that doesn’t mean it’s likely to shed its reputation as a playground for scam artists anytime soon.
That’s according to a report from Diar, which found that ICO exit scams have now cost investors nearly $100 million.
The majority of these stolen funds, an estimated $68 million, has been raked in by exit scams that have occurred during the first two weeks of August. The largest, allegedly pulled by the China-based Shenzhen Puyin Blockchain Group, raised $60 million from three separate ICOs before attracting the attention of the State Market Regulatory Administration (SMRA)
n another particularly morbid exit scam, the organizers of Block Broker, an ICO intended to fund the development of a platform that would “completely eliminate ICO fraud” exit scammed investors to the tune of $3 million.

In its report, Diar’s researchers attribute the proliferation of exit scams to the structure of the token sale fundraising model, arguing that it creates misaligned incentives.
They wrote:
“Unsurprisingly, the blatant exit scams continue to plague the largely unregulated ICO sector where the founders have no contractual obligation to deliver a product. After raising millions of dollars with no string attached, the founders’ incentives to actually build a valuable company are very limited.”
As Diar notes, the amount of funds lost to ICO exit scams is particularly bizarre considering how easy they are to spot when conducting even a moderate amount of due diligence. Many, for instance, use plagiarized whitepapers and fake profile pictures. One project famously used a picture of Ryan Gosling for its fictional graphic designer, while another featured a fake testimonial attributed to an image of Jennifer Aniston.
Nevertheless, fraudulent projects, including those that use other tactics than straight-up exit scams, continue to attract hundreds of millions of dollars from investors, often by using FOMO to trick them into acting against their better judgment.
Even supposedly above-board projects have used the hoopla around exit scamming to accrue media attention. As CCN reported, one startup — Savedroid, which raised $50 million from its ICO and other funding sources — executed a fake exit scam in a controversial publicity stunt apparently designed to drum up interest in an ICO advisory service that the project was launching.

this is not a surprise anymore because almost 70℅ of ico today were scam, investors should really have a hard time in researching and investigating the ico before participating in it, dont be rush. always stay alert in every ico that you want to join.

[Obing]

100 million dollars! It's enormous! I haven't idea about this much money. I think strong steps should be taken with this scam projects. Otherwise the amount will be more bigger next time.

[Olalomi]

All these scams allegations is painting the Cryptos world in a bad light and will reduce the confidence of potential investors, the unavailability of a regulating body to scrutinise all these fraudulent ICOs will have prevented some of these scams, its quite sad to hear that some ICOs ran into thin air after collecting investment funds.

[Forsaken Kobolds]

Scams are common in every industry. And in online world it is too much easy to do scams. That's why we are seeing lots of scam ICOs around us. I think we should be really careful about choosing ICO.

[none of us]

i can not really believe that people are stealing so much money, but it seems to be true. somehow icos should be regulated so that something does not happen anymore.

[jayco25]

According to this news I read, is this the end of of ICO? Kindly read through and give your opinion
The cryptocurrency industry may be maturing, but that doesn’t mean it’s likely to shed its reputation as a playground for scam artists anytime soon.
That’s according to a report from Diar, which found that ICO exit scams have now cost investors nearly $100 million.
The majority of these stolen funds, an estimated $68 million, has been raked in by exit scams that have occurred during the first two weeks of August. The largest, allegedly pulled by the China-based Shenzhen Puyin Blockchain Group, raised $60 million from three separate ICOs before attracting the attention of the State Market Regulatory Administration (SMRA)
n another particularly morbid exit scam, the organizers of Block Broker, an ICO intended to fund the development of a platform that would “completely eliminate ICO fraud” exit scammed investors to the tune of $3 million.

In its report, Diar’s researchers attribute the proliferation of exit scams to the structure of the token sale fundraising model, arguing that it creates misaligned incentives.
They wrote:
“Unsurprisingly, the blatant exit scams continue to plague the largely unregulated ICO sector where the founders have no contractual obligation to deliver a product. After raising millions of dollars with no string attached, the founders’ incentives to actually build a valuable company are very limited.”
As Diar notes, the amount of funds lost to ICO exit scams is particularly bizarre considering how easy they are to spot when conducting even a moderate amount of due diligence. Many, for instance, use plagiarized whitepapers and fake profile pictures. One project famously used a picture of Ryan Gosling for its fictional graphic designer, while another featured a fake testimonial attributed to an image of Jennifer Aniston.
Nevertheless, fraudulent projects, including those that use other tactics than straight-up exit scams, continue to attract hundreds of millions of dollars from investors, often by using FOMO to trick them into acting against their better judgment.
Even supposedly above-board projects have used the hoopla around exit scamming to accrue media attention. As CCN reported, one startup — Savedroid, which raised $50 million from its ICO and other funding sources — executed a fake exit scam in a controversial publicity stunt apparently designed to drum up interest in an ICO advisory service that the project was launching.

If this true this is very bad news to the crypto world. That is why always be careful in investing money specially fraud project. Just make sure that Team is not fake and they also attending conferences and summit. Good thing also if they have legal document and real office. I hope people will to their own research before they invest money.

#Support Vanig

[ekechie]

That's really a huge money, I believe there will still be more than that because there might be some exit scams which might not be recorded, people only notice the exit scam of a popular ICO not really the non popular ones.

[boidepzaikhoaito1]

Virtual development projects are "scamming" real people and real money. Many people who bring real money to join the ICO but then the developer drowned who does not know who to hold, nor can resell the stock "Token to anyone.

[AllStrong002]

Scam ICO is si called problem in ICO projects now-a-days. Many projects are appeared as scam now-a-days.

[Goodwin54]

Find out promising ICO project is hard now-a-days because there are many scam ICO projects are appeared and that's felt very bad effects on investors.

[Nahl]

The popularity of ICO currently looks decreasing because some of fake ICO projects already ruin the reputation of ICO and if we still found scam ICO dominate the market then i'm pretty sure ICO gradually will lack of interest or probably will disappears however regarding the statistics i think possibly the number of amount higher than that

[hakertajniak]

Unfortunately that is true. Because many investors who want to make quick profit without doing some due diligence first.
I think there must be some company that regulate every ICO in blockchain. So they can ensure that the project ICO is real and not a scam.

[tetyulfania]

Sometime ico became scam although have success with ico sale and raised more than 80% token sale, why its happen. Many investors asking about why have scam although success with 80% token sold to the public, more strong reason because we can’t trust the owner of ico projetc.

[Flashback54]

Such an unsustainable market like cryptocurrency a possibility of any kind of accident occurring. But we should be more careful in this regard so that we can keep our investments safe.

[markieeeloy]

We can avoid these interactions by making more extensive research on the team and their project. Most of the ico nowadays are also filtered already by the SEC ensuring that the possible ico that is scam never gets enter to the tokensale.

[weisner]

Fraud is very detrimental, this is very sad, and must be followed up. ICO is one of the most important points in the crypto world besides trading and mining. This should not happen, but there are indeed many people who are less satisfied with the performance and become ICOs as easy targets for deceiving investors, an evil act and will not be a blessing later.

[Oilacris]

The popularity of ICO currently looks decreasing because some of fake ICO projects already ruin the reputation of ICO and if we still found scam ICO dominate the market then i'm pretty sure ICO gradually will lack of interest or probably will disappears however regarding the statistics i think possibly the number of amount higher than that

The popularity is over because ICO is being used to scam out investors and reputation is really being mainly affected and I cant really deny that investors will lack already some interest to make investment because of rampant scammers.This isn't really just the amount being stolen and I would believe this do even involved billions of usd if we do try to see the lots of scam ICO wayback in previous years even upto now.

[sanacaks]

Nowadays its getting hard to find a good trusted ICO. even you try deep  researches, read the whitepaper, ask other websites, they can still scam you. Because they are getting more and more professional for scamming. Big marketing, professional blogs, payed votes.  Easy million dolar without any responsibility attracts many professional scammers. Everybody needs to take care of his/her hard earned money.

[TravelMug]

You may want to read this:

Unpacking the 5 Biggest Cryptocurrency Scams

Cryptocurrencies have revolutionized the way the world looks at transactions - but they’ve also facilitated some monumental scams over the past nine years.

The success of Bitcoin and a number of altcoins jumpstarted an industry that is incorporating Blockchain technology in a number of innovative ways.

While the smartest minds have created some game-changing companies backed by the power of Blockchain and cryptocurrencies, nefarious minds have also jumped on the bandwagon, fleecing unwitting investors in elaborate scams.

https://cointelegraph.com/news/unpacking-the-5-biggest-cryptocurrency-scams

So I still don't know why people are still willing to invest their hard earn money to ICO's. Of course not all ICO are scams but you need to use your common sense and not fall for this kind of trap. Good thing though is that this forum has help unravel a lot of scam ICO from the beginning. You just have to visit the Scam Accusations thread: (https://bitcointalk.org/index.php?board=83.0) before making decisions to invest in any ICO.