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How to Smartly Invest in ICOs and the Risks They Present

By newadmin / Published on Tuesday, 06 Feb 2018 16:25 PM / No Comments / 11 views


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About two decades ago, the viability of an exciting new technology appeared to be hitting a stable plateau. With that plateau came the excitement of a new method of communication across all industries — and eventually, a lot of those companies received massive financial funding and even went public. Despite the viability of these ideas, the industry crashed hard and the idea that Silicon Valley simply printed stock (on toilet paper, no less, as lampooned by The Simpsons) became the crux of the so-called Dot-Com crash.

By 2002, companies big and small were eviscerated and millions of dollars were lost as great ideas (and plenty of bad ones) struggled to find financial solvency. From major search-engine players such as Excite to innovators like WebVan (the precursor to modern food/grocery delivery services), people who jumped on the bandwagon simply because of buzz soon found themselves out a lot of money.

Today, the new technology buzz is all about the blockchain and initial coin offerings (ICOs). Blockchain represents as much of a leap forward as the advent of the internet by creating the path for secure and transparent interconnectivity. Countless companies are using this as the foundation for their business.

The big question, then, is this: Should you invest in these companies?

The Benefit of Healthy Skepticism

Having been in the blockchain industry for years now, I was recently asked which hot new ICO caught my eye for investing. I understand why people think this way — it’s easy to get swept up in buzzwords and hype.

In short, there’s a lot of temptation out there, especially with ICOs having a strong record of high returns, so much so that blockchain and ICOs are causing significant levels of buzz in financial sectors.

But the truth isn’t quite as rosy, and many bad ideas will reach ICO. In fact, without the full range of SEC regulation watching over ICOs, fraudulent ICOs are also making it to market — and they’re taking people’s money before they know it thanks to the fast nature of cryptocurrency transactions.

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Shutterstock

About two decades ago, the viability of an exciting new technology appeared to be hitting a stable plateau. With that plateau came the excitement of a new method of communication across all industries — and eventually, a lot of those companies received massive financial funding and even went public. Despite the viability of these ideas, the industry crashed hard and the idea that Silicon Valley simply printed stock (on toilet paper, no less, as lampooned by The Simpsons) became the crux of the so-called Dot-Com crash.

By 2002, companies big and small were eviscerated and millions of dollars were lost as great ideas (and plenty of bad ones) struggled to find financial solvency. From major search-engine players such as Excite to innovators like WebVan (the precursor to modern food/grocery delivery services), people who jumped on the bandwagon simply because of buzz soon found themselves out a lot of money.

Today, the new technology buzz is all about the blockchain and initial coin offerings (ICOs). Blockchain represents as much of a leap forward as the advent of the internet by creating the path for secure and transparent interconnectivity. Countless companies are using this as the foundation for their business.

The big question, then, is this: Should you invest in these companies?

The Benefit of Healthy Skepticism

Having been in the blockchain industry for years now, I was recently asked which hot new ICO caught my eye for investing. I understand why people think this way — it’s easy to get swept up in buzzwords and hype.

In short, there’s a lot of temptation out there, especially with ICOs having a strong record of high returns, so much so that blockchain and ICOs are causing significant levels of buzz in financial sectors.

But the truth isn’t quite as rosy, and many bad ideas will reach ICO. In fact, without the full range of SEC regulation watching over ICOs, fraudulent ICOs are also making it to market — and they’re taking people’s money before they know it thanks to the fast nature of cryptocurrency transactions.

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