Published On: Thu, Sep 14th, 2017

ICO Problem – What’s Next for Startups and Investors

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Initial Coin Offerings have scarcely been out of the news lately. A number of high profile scams, bans, and regulatory plans have seen them eating up column inches. But where does that leave the genuine value startups and those wishing to invest in them?
The Background
An ICO in its most basic form is used as a tool for finding backers to raise funds for new blockchain projects. A company will pre-sell a coin (or token) for use within the ecosystem of a final product, in order to finance the creation of that ecosystem.
Unfortunately, some ICOs fell victim to scammers, causing investors to lose their money. In addition, many companies simply offered coins for coins sake, having no further value to backers other than speculative price rise. These essentially behaved like thinly veiled securities, and quite rightly attracted the attention of regulatory authorities.
Thus we have the SEC, the MAS, BOC and who knows how many other acronymous agencies in a panic.

The Good News
This is for the benefit of the entire industry. Genuine startups do not want to fall foul of the law. Their founders do not want to risk a hefty fine or prison sentence. Investors …

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