is advertising for ICOs unethical?

[Deylandra]

I've noticed many ICOs have to spend a lot of money on promotions and advertising.

For example, let's say an ICO raises 10 million dollars but has to spend 9 million on promotion.

Therefore, they only really raised 1 million for the project.

Isn't this unethical?

If you're starting a company and looking for investors the traditional way via stock equity, you would never spend 9 million or even 5 million or even 2 million in order to raise 10 million from investors.

This begs the question, what ratio of promotion cost versus funds raised for ICOs is ethical?

And how do we know if an ICO is using an ethical ratio?

[alexsandria]

I've noticed many ICOs have to spend a lot of money on promotions and advertising.

For example, let's say an ICO raises 10 million dollars but has to spend 9 million on promotion.

Therefore, they only really raised 1 million for the project.

Isn't this unethical?

If you're starting a company and looking for investors the traditional way via stock equity, you would never spend 9 million or even 5 million or even 2 million in order to raise 10 million from investors.

This begs the question, what ratio of promotion cost versus funds raised for ICOs is ethical?

And how do we know if an ICO is using an ethical ratio?

In the first place, where would you gather an information concerning how much would the ICO spent on promotions? Because thinking about the matter, Projects aren't even responsible to fund the bounty hunters, in addition marketing transaction I guess would not going to price that high just to say, they've putted the right amount in marketing.

[Soberb]

Very good question. I also do not know exactly why new projects spend so much money on advertisements. In cryprocurrency, advertisement is worth it? It there any set criteria that binds a project to collect only a certain amount of money? or one can collect as much as it can? But I think cryptocurrrency is such platform where advertisements rule and without advertisements, you can not get the attention of traders and investors. That is why I think it is a bit different from stock market. It is decentralized and it is for all people around the world.

[aioc]

I've noticed many ICOs have to spend a lot of money on promotions and advertising.

For example, let's say an ICO raises 10 million dollars but has to spend 9 million on promotion.

Therefore, they only really raised 1 million for the project.

Isn't this unethical?

If you're starting a company and looking for investors the traditional way via stock equity, you would never spend 9 million or even 5 million or even 2 million in order to raise 10 million from investors.

This begs the question, what ratio of promotion cost versus funds raised for ICOs is ethical?

And how do we know if an ICO is using an ethical ratio?

I don't think is the case, they spend only  3 to 7 % of the coin supply I have never seen an ICO that spend half of their supply just to market their token, I have been part of bounty campaign and they only spend 7% the most, can you name that bounty campaign that spend over 50% of their supply.

[gilangIDR]

For me that is not a problem, every ICO project must have its own way. They are free to promote their projects. Of course, nothing should be violated, as long as it is in accordance with the rules and ethical codes that apply, promotion of the ICO project is a legitimate thing.

The development of the ICO project this year has indeed declined because most projects have made changes towards the IEO.
But still there are still good opportunities and it depends on who we choose.

[vv181]

I wouldn't say it unethical instead ill say it ineffective, There is nothing wrong about the project funds allocation within their budgets, but it's kind of ironic if the project prioritizes promotion funds instead of research and developments. Personally, I'll stay away from that kind of project whereas their prioritize a promotion or advertising instead of focusing on the budget of the development.

[GhostWithin]

I don't think is the case, they spend only  3 to 7 % of the coin supply I have never seen an ICO that spend half of their supply just to market their token, I have been part of bounty campaign and they only spend 7% the most, can you name that bounty campaign that spend over 50% of their supply.

it's about promotion in generally, and the bounty campaign is only part of that.
However, I havnt seen project that would spend so much money on promoting and herewith didn't try to hide this fact.
Usually scam projects spend most of the budget on promotion.

[Herbert2020]

it is nowhere near that numbers. you see the main purpose of an ICO is to raise funds no spend them! in other words it is a scam where lazy people copy some code and get paid for it. such people don't want to spend that much money. that is the main reason why they keep advertising using fools through "bounty hunting" and things like that. because they can pay them an extremely small amount of money which is not even real "money" it is their token which these fools have to sell to get money so as a result it doesn't even cost them anything to advertise their ICO since they are paying in a token that they created out of thin air with no cost.

[pinoy.bolanon]

I've noticed many ICOs have to spend a lot of money on promotions and advertising.

For example, let's say an ICO raises 10 million dollars but has to spend 9 million on promotion.

Therefore, they only really raised 1 million for the project.

Isn't this unethical?

If you're starting a company and looking for investors the traditional way via stock equity, you would never spend 9 million or even 5 million or even 2 million in order to raise 10 million from investors.

This begs the question, what ratio of promotion cost versus funds raised for ICOs is ethical?

And how do we know if an ICO is using an ethical ratio?

Because business needs massive promotion whatever it takes, this is the first rule of putting up a business. ICO is an international business so, you need to cater the entire audience by means of massive promotion, and whether the business would succeed or not, its up to them to decide.

[freedomgo]

It's not unethical if you believe that the ICO you are advertising is legit and will create an opportunity for the potential investors.
There is a freedom in ICO as anyone with an idea can start its ICO, but we supporters or promoters needs to ensure that we conduct a simple
investigation on the team to determine their capability to run the project.

This is only not for the advertisers, but also for the investors, it's necessary that they study as well as investing is always risky.

[steveabrahams]

Actually it's not that much to advertising for ICO. You can just hire bounty managers and let them control the bounty and the advertising. I don't know beside the bounty, like google ads or social media ads, it will takes more cost. It's worth actually to advertise ICO for the ICO owner.

[matchi2011]

Only inexperienced teams will make that, from where you define the figures it will not happen to any serious projects to spend lots of money just to cater their promotions since most of them will only use 5-10% of actual revenue or maybe less than that, serious developers will focus to development and how they can manage to move forward using the funds that they gathered for securing the progress of their projects.

[TravelMug]

However, I don't think that ICO will be spending that much money in their promotions though. Where did you get that number? But for the sake of argument if ICO just raises $1 million then I wouldn't say it's unethical.

It is still within their boundaries, and it's really up to them how to manage the remaining balance o $1 million. If they truly believed that their project is a game changer then they will continue to developed it and squeeze everything and try to make the project successful in the future.

[elitemobb]

I think that spending huge amounts of money on project promotion is stupid since the project collects funds primarily for the development of the project and not for advertising, so advertising should be in moderation.

[Ailmand]

I think that's too much and I hope that you gathered that information from a reliable source. I don't think that a certain ICO would spend too much on promotion and advertisement. We all know that every ICO needs to get advertised and I think some team spend that amount because they are managing a big project.

[boazsalosa]

There is no need to spend so much money on advertising as long as we can market it in a simple way, investors will be interested if the marketing is good and there is no need to fancy to hire anything.

[bgaf]

I've noticed many ICOs have to spend a lot of money on promotions and advertising.

For example, let's say an ICO raises 10 million dollars but has to spend 9 million on promotion.

Therefore, they only really raised 1 million for the project.

Isn't this unethical?

If you're starting a company and looking for investors the traditional way via stock equity, you would never spend 9 million or even 5 million or even 2 million in order to raise 10 million from investors.

This begs the question, what ratio of promotion cost versus funds raised for ICOs is ethical?

And how do we know if an ICO is using an ethical ratio?

There is always a fund or budget component for this. Typical project wouldn't spend much on an advertisement knowing they can't get an audience in order for them to success. If I will create a project, I will hire someone for bounty with an effective marketing. Not just a typical one, and giving a fair budget. Also, used some ads like CMC those with high traffic. Investors likely  to check whats on the ads. Dont spend too much, focus more on development.

[zgrdyg]

I don't think it is unethical at all (unless it is a scam and you have knowledge about it)

You are not pointing gun to anybodys head to buy, you are just telling. At the end, everyone should make his inspection and act on it, not just take anybodys word.

[mrdeposit]

I've noticed many ICOs have to spend a lot of money on promotions and advertising.

For example, let's say an ICO raises 10 million dollars but has to spend 9 million on promotion.

Therefore, they only really raised 1 million for the project.

Isn't this unethical?

If you're starting a company and looking for investors the traditional way via stock equity, you would never spend 9 million or even 5 million or even 2 million in order to raise 10 million from investors.

This begs the question, what ratio of promotion cost versus funds raised for ICOs is ethical?

And how do we know if an ICO is using an ethical ratio?

Projects do not specify soft cap unnecessarily. If devs are spending extra money on marketing, this is thier own choice.
If you are talking about bounty, 90% of the bounty already get less than the expected money.

[Twinkledoe]

I've noticed many ICOs have to spend a lot of money on promotions and advertising.

For example, let's say an ICO raises 10 million dollars but has to spend 9 million on promotion.

Therefore, they only really raised 1 million for the project.

Isn't this unethical?

If you're starting a company and looking for investors the traditional way via stock equity, you would never spend 9 million or even 5 million or even 2 million in order to raise 10 million from investors.

This begs the question, what ratio of promotion cost versus funds raised for ICOs is ethical?

And how do we know if an ICO is using an ethical ratio?

In the first place, where would you gather an information concerning how much would the ICO spent on promotions? Because thinking about the matter, Projects aren't even responsible to fund the bounty hunters, in addition marketing transaction I guess would not going to price that high just to say, they've putted the right amount in marketing.

His numbers are funny to begin with. Who in the right mind will spend about 90% of their ICO generated funds to promotions and advertising (though it is just an example)? Most of them are after for the money, they will never spend that much in these campaigns. Most projects are paying their tokens because they don't have to spend anything, only the gas fee if it's eth token. As far as I know, there is no rule in terms of how much you want to spend with your promotions. It depends on your project plans.