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

nytimes.com

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

#221

Post by michaelscott »

Cakez0r wrote: post #182
ashnyc wrote: post #137

ICO are the best thing that ever happened. This is no different then kickstarter.com started. People where saying the same things. People put up lot of BS project and they got funded, in time these kind of project will fail on there own. This is just the start, no government or bank would have supported such system. For once, the small guy can participate in this market. I would have loved to invest in amazon, facebo…

Participating in ICOs are not the same as investing in the company and receiving equity in return. The vast majority of tokens are not backed by equity in the company that created them.

The concept behind the tokens is that they take the value place of equity in a company. A person buying tokens is saying that they believe that the core product the company is providing is good enough that the tokens will increase in value in the future.

Replace the word "token" with the word "equity" in the previous sentence and it would still be true.

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

#222

Post by johnyzee »

taneq wrote: post #185
dmichulke wrote: post #174

Earlier quoted context omitted.

> Real money has never been cheaper than it is now. As strange as it sounds, this is indeed the case. The cost of money is measured in $ per $ (or actually currency per currency) which is a percentage also known as interest rate. There are no known records of any time in history where interest rates were negative. Sure, only banks can "get" these but they will do and hand them to the next by investing in his asset.

The interest rate in Japan is currently -0.1% and has been since the start of 2016. https://tradingeconomics.com/japan/interest-rate

Japan has been using negative interest rates for decades.

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

#223

Post by sjg007 »

Cakez0r wrote: post #165
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 t…

They might be interpreted gift cards in that sense.

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

#224

Post by sjg007 »

michaelscott wrote: post #221
Cakez0r wrote: post #182

Earlier quoted context omitted.

Participating in ICOs are not the same as investing in the company and receiving equity in return. The vast majority of tokens are not backed by equity in the company that created them.

The concept behind the tokens is that they take the value place of equity in a company. A person buying tokens is saying that they believe that the core product the company is providing is good enough that the tokens will increase in value in the future. Replace the word "token" with the word "equity" in the previous sentence and it would still be true.

They can't be equity by definition otherwise they are unregulated securities and then the SEC will step in and shut everything down or make you subscribed to the new equity crowdfunding rules.

You want them interpreted at best as as in game currency or at worst as gift cards.

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

#225

Post by praptak »

jamespitts wrote: post #45

I would like to make an appeal to the YC community: please reach out and help guide those involved in this rapidly advancing phenomenon. There is a huge amount of instantly-deployable capital in Ethereum and Bitcoin, held by individuals now seeking ways to put it to work. Many technologists will naturally make use of this energy, but so will BS artists and people under the influence of hubris. I am making this appeal…

I could, if I determined there's an insane amount money to be made. Sorry, I'm not helping the rich get richer out of a good heart.

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

#226

Post by Cakez0r »

michaelscott wrote: post #221
Cakez0r wrote: post #182

Earlier quoted context omitted.

Participating in ICOs are not the same as investing in the company and receiving equity in return. The vast majority of tokens are not backed by equity in the company that created them.

The concept behind the tokens is that they take the value place of equity in a company. A person buying tokens is saying that they believe that the core product the company is providing is good enough that the tokens will increase in value in the future. Replace the word "token" with the word "equity" in the previous sentence and it would still be true.

But when you own equity, you own a tangible piece of a company. I could say I believe in Amazon's core products and create an Amazon coin, but why should the value of my Amazon coin be correlated to the market cap of Amazon when it has no link to Amazon shares?

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

#227

Post by api »

wc- wrote: post #206
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…

It is important to clarify that buying one of these tokens does not result in you owning a 'share' or a percentage of the company that issued them. Some lawyers are using this lack of ownership as a critical part of their argument that tokens are not a security and therefore ICO's are legal. It's complicated and a very gray area right now. In response to this gray-ness, ICO's are now requiring investors to declare th…

So it's illegal to do an ICO and offer something of actual potential value, namely shares?

Seems like a serious unintended consequence of regulation.

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

#228

Post by libertine »

mathieuuu wrote: post #38

I am amazed that in 2017, there is still people qualifying Bitcoin or Ethereum of ponzi schemes. Crypto currencies have a lot of problems (technical, economical, philosophical, ICO are insanes) but saying they are ponzi schemes is plain wrong. And it just takes 5 minutes of reading on Ponzi Schemes signs and basic knowledges of how those currencies work to understand why.

I've asked this for quite some time and still no one was able to answer.

If the power has shifted to an elite who controls the great majority of the currency, and has the power to withdraw/dump coins (basicaly influencing the supply side of the market, and control the value) - I'm pretty sure there are people/organizations who invested into such positions - and have the power to simulate value and draw people into this gold rush...

Where is the line drawn between this and a scam/fraud?

Is it when the control party withdraws all the value from it and dumps it?

For as long as everything is being valued in a positive way, everything is fine?

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

#229

Post by libertine »

ShabbosGoy wrote: post #152
RexetBlell wrote: post #64

Earlier quoted context omitted.

They are as much a Ponzi scheme as gold (which has almost no practical use) and ugly paintings that cost millions http://www.therichest.com/luxury/most-expensive/10-ugly-piec... If expensive ugly paintings are not a Ponzi scheme, then cryptocurrencies are not a Ponzi scheme.

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

No... it's not like oil, or steel, or gold imo.

There's no way an economy can be defined by something of no practical value.

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

#230

Post by bjl »

api wrote: post #227
wc- wrote: post #206

Earlier quoted context omitted.

It is important to clarify that buying one of these tokens does not result in you owning a 'share' or a percentage of the company that issued them. Some lawyers are using this lack of ownership as a critical part of their argument that tokens are not a security and therefore ICO's are legal. It's complicated and a very gray area right now. In response to this gray-ness, ICO's are now requiring investors to declare th…

So it's illegal to do an ICO and offer something of actual potential value, namely shares? Seems like a serious unintended consequence of regulation.

Basically, its illegal to market exotic investment opportunities to unaccredited investors (for good reason IMO). Same reason only accredited investors can invest in things like CDOs and weather derivatives.
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