Previous year was the best year yet in terms of money raised through ICO’s (Initial Coin Offering) as it was calculated that over $3 bln was raised in previous year alone.
Most of the times it has been guessed that a significant part of the ICO’s will probably collapse at the point of fundrasing or when it comes to the actual integration of the project concept.
According to trustworthy ICO tracker – Tokendata, from 2016 over 200 ICOs have failed in various stages and sneaked away with investors money. The most popular ICO fundamentics category in whole market was infrastructural, both 2016 (44.6%) and 2017 (25.8%).
There’s no exact number of how many ICO’s messed up, but some have deceived with 0$ worth of gains while others – over millions of dollars (a.k.a. billions and billions and billions).
The most occured way ‘developers’ used to escape crowdsale after raising some specific gains is to quietly backdoor after use various channels of social media: telegram, facebook, twitter, reddit and etc. However even some bad guys it self got robbed in the middle of the day, others took unique and extraordinary option to quit with investors money, for example – Prodeum went out with a bang. They just left their website totally empty with a single word on screen ‘penis’.
Here’s top 5 of the infamious failed ICO’s which ones managed to raise (or to rob?) serious money
Had a breaking $232 mln ICO, but it all came down as the team behind it all began infighting. According ot Reuters Tezos managed to be one of the most successful token sale campaigns in ICO history, but the conflict between management brought panic among the investors and worth of Tezos beared straight down for over 70% in a few hours.
Focused on a security and cryptography which was about it’s new encryption methods. However, the Techcrunch reported that Enigma team was hacked away with $500,000 worth of Ethereum just before their ICO was about to go live after suspecting scam afair on Enigma investors.
Promised to develop a system of instant, virtually interest-free payments anywhere in the world, but no whitepaper was published, and there was also no information about the developers. Ethanvanderbuilt announced SwissCoin was brought to the ground when the Ukrainian Prosecutor’s office, along with the national police exposed the fraudulent project, whose creators are suspected to have more than $500,000.
Team raised $6.4 mln, but finally have admitted their defeat when CoinDash were hacked by sum of $7 mln leaving them fully broke, atleast that’s what team announced. According to Coindesk The method of the hack is still uncertain.
#5 The Dao
Organization was meant to operate like a venture capital fund for the crypto and decentralized space. The lack of a centralized authority reduced costs and in theory provides more control and access to the investors. The Dao crowdfunding period ended with an astonishing ~12M of ETH, worth roughly 150 million USD at the time. These funds were stolen by a hackers who managed through security.
ICO’s are more dangerious than people expect. Many factors could leave investors with empty pockets. It is necessary to do detail research in every investment you are planning. In short – invest only as many as you are confident to lose.
Where’s big gains – there’s big loses.