Dutch regulators warn about ICO practices
Dutch AFM pro Blockchain but warns of ICO's
On Tuesday, November 14th, 2017, a statement was released by the Netherlands Authority for Financial Markets. The statement highlights the risks investors may face in regards to new cryptocurrencies and ICO projects. Which are all built on a blockchain crowdfunding models.
The Netherlands regulatory body obviously sees the benefits that Blockchain technology yields regarding financial and public services. However, there is a lot of risks involved with ICO’s that utilize Blockchain technology for financial funding.
The AFM highlights that ICO’s often promise investors ridiculous returns on their investments, which are simply unrealistic. Well, some ICO’s really can double, triple, or quadruple an investors money if they are actually legitimate. However, a lot of ICO’s are blatant scams, and you have to be totally oblivious to not to see some obvious warnings signs.
What Investors need to watch out for in ICO’s.
Investors need to watch for sucky websites, team members who look like they have no clue, strange social media profiles, crappy translations, no direct contact with the team, huge early bird bonuses, etc.
Oh, and make sure that the project actually needs Blockchain technology. Because if it doesn’t, you have discovered a fat flopping mess and I hope that you didn’t send the project any money.
If you believe that you might fall victim to an ICO, check out this article on Cryptona that goes over some coin offering warning signs and info.
ICO stances around the world.
South Korea and China have forbidden the ICO funding model from being used entirely. The ESMA also released a statement going over the dangers of these investment models earlier this week.
But, while the Dutchmen warn investors of ICO dangers, they admit that they cannot actually fully regulate them.
Personally, I think that some ICO’s are wonderful, while others are rubbish. I don’t want to offend anyone but generally, even a short correspondence with some team members is enough to understand if you are being funneled into a scam. Though the model did raise over $3 billion to date, and some wicked returns can be made.
New ICO investors, please do as much research as you can for your ICO’s of choice. If you are going crazy from all of the information that you need to digest, try and find a friend who is knowledgeable and willing to help you.
Other than that, stay up to date with ICO news on Cryptona.
Leave a comment below if you have any questions.