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ICO’s and You: Scam or Not?

In Cryptocurrency
ico initial coin offering
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Many of you have seen the varying information of people vying for your money at every turn. Yet we are seeing a lot of promise with the idea of investing into ICO’s but are they just the new face of a modern scam? The idea is you send them some money and in return for this investment you will get a huge return when the coin ends up going live.

Yet not every ICO is really a coin, but is being bundled as a service or product. Instead of mining per say you send out referrals, and the more people you refer the more coin you get. Most of these ICO’s do not promise high value from their coins and is offering high volumes of their coin for not huge investments. This is becoming how most of the new ICOs are working, and we are seeing focus on a wide array of markets and services. Such as funding new games, to new streaming services.

How could this be such a bad plan to invest in something that looks promising? While this has a fairly simple solution, the booming growth in the crypto market place reveals many parallels with what happened in the dot com bust. Not all growth is good and being over saturated with promises, there not many of these new ICOs that are offering a strong new product. We could easily see most of these investments fail, or even just stay in the doldrums of not making profit until they fall off into obscurity.

The idea of a scam is hidden behind a vale of false promises and a backed community. The idea of a pyramid scheme may come to mind before a traditional take your money and run scam. This is exactly what most ICOs are looking like that the moment. The key here is most ICOs do not seem like a solid bet if you are just getting into crypto currency and you want to get your feet wet. A great deal of research needs to be done and you should fully understand what you are investing in. If you believe in a project and see it growing then you should invest. If the project seems too good to be true, then that is very likely the case.

onecoin scam

One of these ICOs did however get raided and shown to be a scam. This ICO was One Coin and the bigger thing that came from this raid is the fact that they found 14 other companies tied to One Coin. It was not this last raid that sparked the concern off, the authorities where investigating and shutting down One Coin all the way back in December 2016. The Italian Antitrust Authority accused them of using an illegal pyramid sales system.

This is not something we see with the vast majority of ICOs but it is an issue that must be talked about and understood. Yet a bigger problem you will encounter when searching are projects that are designed to fail, even if the intentions behind them are solid. You also need to look at the team and make sure they can back up their product with skill and professionalism.

Investing into ICOs still is very tempting as we see BTC climb back up from its bottom. Yet there are many other coins to keep an eye on such as ETH, PIRL, AKROMA, etc. Investing has its risks and crypto is a fast-moving market that never sleeps. Following your favorite ICO and coin is key to make the right move at the right time. Keep in mind you should be fully aware of what is going on with any of these before making your first move. Even if you plan on investing into mining, where ASIC is now very hard to pull a profit from.

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