Identifying rogue ICOs in the crypto world
Winning by cheating is nothing new in our life today because people have long dreamed of making a lot of money by cheating others. .
Contrary to what many people think and think that a popular form of scam today is nothing more than a Multi Level Business (MLM) scam, the real ICO scam is how people “make” a lot of money. bad behavior in the digital age of the 21st century. This article provides you with useful information that will help you deepen your knowledge and identify the best ICO scams.
What is an ICO and how is it related to cryptocurrencies?
An “Initial Coin Offering” – or ICO – is a sale of tokens for cash or another cryptocurrency. ICO is carried out with the main aim of soliciting investment capital for the startup and in return, the contributors receive certain benefits after the successful implementation of the project.
However, when the company that launched the ICO kept all the initial investment and most of the tokens were issued, the real trouble started.
Are ICOs a scam?
As you can see, ICO is a financial solution that facilitates calls to invest without being bound by any obligations. In essence, ICO can be called a scam from the start, because there are no guarantees if one party decides to withdraw.
The truth is that many ICOs and the cryptocurrencies that accompany them do not have the necessary documentation to prove that they are on the right track. So, deciding to participate in an ICO is like investing in an unknown startup. He took too many risks. The comments above, while somewhat exaggerated, are red flags to watch out for.
Why do ICO tips work?
We humans will always maintain our selfish nature and can still make a lot of money through speculation.
The simple reason why ICOs are so popular is that currently they are not officially regulated by any financial authority and they still exist in the cryptocurrency ecosystem – where the government is not yet strictly regulated.
Your investment is highly liquid; You can still exchange money anytime, which makes this segment very special and attractive in the eyes of many people.
Combine the above factors with the casual mercenary who has little knowledge of investing or the nature of asset classes but is willing to put money into something that promises high returns. Hype can help quickly increase the value of a cryptocurrency and make it more dangerous.
How to recognize a fraudulent ICO?
When investing in an ICO, each of us must remember carefully: you don’t invest, you bet. Most of the companies that promote ICO will be traitors. Many do not even intend to raise capital even to manufacture a product.
The first rule when deciding to donate money to a newly opened ICO is never invest unless you have personally seen a prototype of the project in action.
Due diligence is arguably the key to investigating ICOs and promised products. You cannot rely on other people’s comments, thoughts or opinions. Simply because there are always people willing to accept money for saying nice things about something random.
It’s better to only invest in things you understand well
It is best to invest only in things that you understand well. Since you already know the essence of the product or project, you build a knowledge base to better study and understand the technology behind it and the prospects for the market. , supply, demand, development roadmap, stimulus factors, etc.
As many of us know, most startups fail and close after only two or three years from their inception. Those that did not suffer from the above outcomes were expropriated or forced to raise additional investments.
We will definitely see the day when ICOs disappear. All ICOs that have arisen as a result of raising hundreds of millions of dollars in past investments will eventually disappear.
This process does not happen overnight, but takes one to two years. We have seen the same in the crypto world.
WARNING: Investing in financial products involves a lot of risk and may not be suitable for all investors. Therefore, please think carefully and check yourself before you decide to link to this website. CryptoViet.com.