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Easiest Path to Riches on the Web? An Initial Coin Offering

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Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#161

Post by redtuesday »

atomical wrote: post #82
pmorici wrote: post #51

Earlier quoted context omitted.

If you go to https://coinmarketcap.com/ you will see they have info on over 600 individual crypto currencies. 99% of them are going to be worthless long term. Best case scenario a handful of them survive. I'd be extremely skeptical of any coin that distributes coins via an ICO or "pre-sale" instead of via competitive mining like Bitcoin.

Mining is a waste of energy. An ICO makes sense if they 1) have a product that benefits from a blockchain, 2) have a great team and a demo of their product.

As a layman which also thinks of mining as a waste of engery (although it seems necessary as the other commenter pointed out) I hope gridcoin [0] or something similiar takes off.

[0] http://www.gridcoin.us/

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#162

Post by piaste »

agrajag wrote: post #93
ransom1538 wrote: post #70

Earlier quoted context omitted.

You can trade for goods or services with your coins. You cannot trade for anything with cash dug in the desert. Cash is confiscated daily by authorities.

If I buy a house or a car with cryptocurrency that can be confiscated. If I live a lavish lifestyle while under a judgement I'm not paying, then the court can imprison me indefinitely under contempt of court. Courts have centuries of case law for how to deal with people that hide assets from judgements. They're not going to care whether your assets are in a shell company or a cryptocurrency.

You are correct, when it comes to protecting your assets from (minimally competent) authorities, cryptocurrencies aren't much better than a hole in the ground full of cash.

Where they are much better than a hole in the ground is when it comes to moving your assets to a different jurisdiction. As long as you can physically get yourself from Somecountry to Othercountry, all your e-cash will be accessible in Othercountry regardless of what Somecountry may have to say about it. And even if Somecountry imprisons you, you can still hand over your e-cash to someone else with a single message.

I can't think of any asset that offers that particular advantage.

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#163

Post by joshschreuder »

ailideex wrote: post #155
ShabbosGoy wrote: post #152

Earlier quoted context omitted.

Ether is more like oil - it is a fuel source used to power smart contracts, token sales, and autonomous organizations.

This analogy is not accurate.

What analogy would you use?

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#164

Post by equityloan »

So these ICOs are currently legal? In that case, is it legal to have an ICO for shares in an existing private company?

I am imagining the following scenario:

Someone has some vested shares in a startup. They send proof of their shares to some administrators of this hypothetical service. The shares are then listed on the website. Someone browses the website and decides that they like the company, and they want to invest $10k. They make a request on the site, and then transfer $10k worth of Bitcoins to a specific address. The Bitcoins are then transferred to the person with the shares.

When the company has an acquisition or an IPO, the person then buys $X worth of bitcoins, and sends them to an address, where they are distributed among the investors.

This would be highly illegal, no? Something that would have to operate on the darknet? So then why are people getting away with ICOs?

P.S. As you might be able to tell from my username, I've been trying to figure out a way to sell some of my shares in a private company. (They're a unicorn in Silicon Valley.) You could call it an options contract. Or you could call it a loan, that would be repaid if/when the company has an exit. I've tried using a secondary market service, but the company blocked the sale.

P.P.S. This is completely unrelated to any of the above, but feel free to send me $20k worth of Bitcoins or Ethereum. I could even send you a link to my LinkedIn profile. But of course, this would just be $20k with no strings attached. But who knows, you might receive some bitcoins in the future.

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#165

Post by Cakez0r »

realworldview wrote: post #148

So this is like buying food vouchers that I can redeem at a store that hasn't yet been built, if indeed it has been given planning permission and even if it does eventually get built, I have no idea how the service and product will taste. And I can't then report any irregularities. Ponzi? No. Unregulated gambling? Of course. Sign me up!

It's worse than that. In some cases, the coins literally serve no purpose. To use your metaphor, it's like buying StoreBucks for a store that hasn't been built yet, with no promise that you'll be able to redeem your StoreBucks for anything at all.

For example, a project called Status (http://status.im/) recently held an ICO in which people were tripping over themselves to buy Status's coins. It actually backed up the Ethereum network for several hours with pending transactions and they raised over $100 million USD worth of Ethereum (at the time). See if you can find on their website a description of what the coins are actually used for. I can't!

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#166

Post by nathan_f77 »

xyzzy_plugh wrote: post #61
ransom1538 wrote: post #58

I have a fetish for watching complicated court cases play through. What you realize is a judge in a courtroom has a lot of power. They can take your money, freedom or even kids. However, if I had few hundred thousand in Ethereum encrypted placed into a few random anonymous git hub repros, well, the government can't take it. It is truly yours. No one can take it. That must be horrifying proposition for (some) governme…

And if you go hide a few million bucks in cash in the middle of a desert, they can't take it either. The hard part has always been getting it out and not getting caught. Nothing is truly yours.

I just realized Breaking Bad might have ended very differently if it was set in the present day.

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#167

Post by kaffeemitsahne »

ruytlm wrote: post #84
detaro wrote: post #77

Earlier quoted context omitted.

Not every questionable, bad or even fraudulent financial construct is a Ponzi scheme. Unless a coin has a clear promise of payout that the people organizing it would have to satisfy, it can't be a Ponzi scheme.

I suspect they're not using Ponzi scheme literally, more as a shorthand for the kind of scheme that promises plenty, but doesn't actually do anything. See e.g: http://www.nytimes.com/1990/02/25/books/nothing-but-zzzz-bes...

Luckily we already have a word for that kind of scheme, "scam".

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#168

Post by kaffeemitsahne »

daveguy wrote: post #96
mschuster91 wrote: post #48

Earlier quoted context omitted.

Money laundering, in my opinion, is not only legitimate, but neccessary , given that e.g. European banking transactions end up via SWIFT or implants at the NSA headwuarters. In addition many governments try to move citizens to "electronic payment" (ranging from online banking to NFC credit cards). The reason is once again tracking, and as could be seen during the financial crisis it's easy to just confiscate money wh…

Blockchain currency definitely isn't the solution if the problem is tracking or avoiding confiscation. 1) the blockchain is a permanent immutable log. Once you do tie and identity to an address every transaction ever is immediately available . 2) the key that is the currency resides as just numbers in a computer. Maybe you have yours on a hardware wallet in a fireproof safe. Most don't. Especially those launderers wh…

There are other cryptocurrencies that (try to) solve problem 1), e.g. Monero.

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#169

Post by Jabanga »

equityloan wrote: post #164

So these ICOs are currently legal? In that case, is it legal to have an ICO for shares in an existing private company? I am imagining the following scenario: Someone has some vested shares in a startup. They send proof of their shares to some administrators of this hypothetical service. The shares are then listed on the website. Someone browses the website and decides that they like the company, and they want to inve…

According to some experts in US securities law, if the token being sold gets its value due to its usefulness in an application (e.g. it acts as a currency), it is, in their opinion, legal. If it gets its value from a promise of it providing the holder with a contractual claim on a share of the assets or profits of an enterprise, then it's potentially a security and thus potentially illegal. See the Coinbase securities law framework for more details.

I don't see how your scheme falls into either category. I advise checking with a lawyer before doing anything.

Re: Easiest Path to Riches on the Web? An Initial Coin Offering

#170

Post by nathan_f77 »

feelix wrote: post #20
piratebroadcast wrote: post #17

Anyone have a resource on the technical aspect of this? Seems like these businesses create their own cryptocurrency? Or build it on top of Ether?

You can easily do it in an hour or two by copying and pasting some code off the ethereum site. They encourage it. I like to think of ethereum as a ponzi scheme which spawns ponzi schemes (some of which themselves are intending to be a new platform for generating currencies...) https://www.ethereum.org/token

Wow, thanks for that link. That's actually very cool, and I can see why Ethereum is taking off.
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