If the headline sounds like a provocative statement, it’s meant to be. So, let’s explore the reasons why Initial Coin Offerings should be avoided.

Money is hard to make but so easy to lose. Can you afford to lose yours?

Assuming you’re an astute investor, let’s compare ventures v Initial Coin Offerings:

  • Products already in the market? Almost never.
  • Customer traction? Haven’t seen one yet.
  • Product built & tested? Rarely.
  • Tested team with a track record? Some.
  • Clear value proposition? A white paper and often little more.
  • A valuation that matches the business fundamentals? Yet to see it.
  • Compliance with regulatory requirements for investors? Almost never.
  • Likelihood of getting your money back? Slim to none.
  • Chance of getting a return on capital? A “snowball’s chance in hell”. 
On the edge of calamity.

Why leave yourself exposed?

So why would anyone in their right mind take such a blatant risk? Hype? FOMO? Greed? Possibly.

P. T. Barnum once famously said: “There’s a sucker born every minute.”

Many of the failed ICO’s seem to have taken advantage of that.

I like the question posed by wise old Obi-Wan “Ben” Kenobi.

“Who is the greater fool? The fool, or the fool that follows him?”

Obi-Wan “Ben” Kenobi

If you want to be a speculator, it’s far better to put all your money into the local casino than an ICO.

At least the house has to declare the odds at which they take your money. And you’ll have a little fun losing it.