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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

#231

Post by dmurray »

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.

Yes, exactly that. Compare it to designer drugs, where some reasonably well-understood chemical compound is made illegal, with the effect of creating a market for a similar chemical that is worse understood and may be more dangerous (i.e. less beneficial) to the consumer.

https://en.wikipedia.org/wiki/Designer_drug

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

#232

Post by Alex3917 »

lz400 wrote: post #141
Alex3917 wrote: post #33

Earlier quoted context omitted.

Blockchain is perhaps the most economically important invention of the last 500 years. Right now the whole space is worth less than $100B, and it's going to be worth tens or hundreds of trillions of dollars. Obviously valuations have far outpaced the present usefulness of these technologies, but because the pie is so enormous it would be irrational not to overpay. Right now prices are too out-of-whack with reality so…

This kind of starry eyed delusional exaggeration is why btc/eth/ico, etc. are seen with suspicion in places like HN. Blockchains is an area of active research, they are nowhere near the most important thing in any amount of time, for now they are just promising, time will tell how far they get. But even the marriage of this promise to current early implementations like bitcoin/eth is pure lunacy. People are getting m…

For the record I have no position on whether or not the current blockchains will be the winners of the space. When I talk about the transformative potential of blockchain I'm talking about the idea of realtime triple-entry combined with authenticated data and smart contracts, not about BTC or ETH or whatever.

Clearly this stuff needs another 5 - 10 years until it's ready for mass adoption, and requires lots of new mathematics and technologies that haven't even been invented yet.

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

#233

Post by Zigurd »

pikzen wrote: post #143

>the inability to control people. What's horrifying is people thinking like that. We live in societies with rules, with laws that we have agreed upon, and are, for the most part, fair. These same laws and this same governement protects you, gives you at least some basic services. And you're advocating for not holding up your end of the bargain, and removing one big part of the punishment for not holding it up. To peo…

The reach of the state is already limited by practicality. Everyone is stuck to the planet by gravity and court orders have no effect on this. This is just a newly discovered limitation.

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

#234

Post by api »

bjl wrote: post #230
api wrote: post #227

Earlier quoted context omitted.

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.

Could you do an ICO or BTC share sale to only accredited investors with an online form asking for details a statement to that effect?

I recall from angel funding that the criteria is that you must ask, and that you must have "no reasonable reason to doubt" that a person is an accredited investor. The language is nice and vague, as per SEC regulatory standards.

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

#235

Post by dmurray »

adbachman wrote: post #207
sleepychu wrote: post #151

Last month, a small team of computer engineers in Lithuania raised $14 million in 45 minutes by selling a coin, known as Mysterium, that is intended to give access to an encrypted online data service that is still being built. There has to be more background to this? Why would they ever bother building the service if they have the 14M in cash?

Because unless they've sold their ethereum, they don't have $14mil or equivalent CHF, they've got ehthereum worth that much. It's imaginary money, still, or I'm sure they would cash out.

Ethereum is exchangable for USD (or EUR, which is the currency in Lithuania). Calling it imaginary money isn't helpful here. I'm sure they have cashed out at least some of that.

As for why they would take investors' money (not really investors according to the SEC) and actually build their product? Maybe they value keeping their promises, or their dream is to build this product and the $14mm is just a means to that end.

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

#236

Post by thebiglebrewski »

adbachman wrote: post #209
thebiglebrewski wrote: post #117

Earlier quoted context omitted.

I've bought some Ethereum. Why should I buy more though? Do you have a theory of future value for it?

Sell it when it goes up, but make sure you decide to sell before everyone else decides to sell.

Hahah nice.

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

#237

Post by Zigurd »

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…

There are investors who will lend you money secured by your currently illiquid assets, such as share options. What you propose would be nearly identical in effect.

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

#238

Post by Zigurd »

matt_wulfeck wrote: post #13

These crypto coin bubbles can't pop soon enough.

Look into the fees charged by VC and private equity, and how private equity, in particular, has lobbied themselves into a position where they can be opaque and hold a very dominant position relative to their limiteds before you paint ICOs as sketchy, bubbly, and dangerous. There are downsides to the way many investment vehicles work in theory and practice. ICOs could be a salutary form of competition.

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

#239

Post by zeveb »

pikzen wrote: post #211
Jabanga wrote: post #180

Earlier quoted context omitted.

>We live in societies with rules, with laws that we have agreed upon, and are, for the most part, fair. Societies have gradually grown more unfair as the political system has strained under their growing complexity. According to political scientists, the average voter has an extremely limited understanding of what their government is doing. The typical person's understanding of economics is similarly extremely limite…

>Your comment genuinely horrifies me. I presume you're saying you want people who don't comply to be put behind bars, for extended lengths of time. And their crime, that you insist is harming the rest us, is to not comply with a plan that the majority imposed on them. You've justified it in your mind by arguing that these people accepted a bargain, and are now not holding up their end of it. If your desire is to go l…

> I mean, if you want the punishment to be rubbing your face in the dirt until you understand _why_ things are the way they are and why this is better than your idea now, I'm down for it.

It's genuinely horrifying how much you seem to enjoy the thought of imprisoning or humiliating those who disagree with you. I suspect that this is a result of cognitive dissonance: you realise that you cannot rebut their arguments rationally, and thus wish to 'rebut' them physically, by appeals to the majority.

51% of the people can vote to piss in the cornflakes of the other 49%. That doesn't make it right.

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

#240

Post by Avshalom »

imaginenore wrote: post #94
agrajag wrote: post #87

Earlier quoted context omitted.

While cryptocurrencies have been great (so far) for speculation, give how quickly their worth changes they make a pretty poor store of wealth. I'd prefer my cash to be worth in 1 year roughly the same as it's worth today.

Oh, those poor bitcoin/ethereum holders, they only gained a few hundred/thousand percent in the last couple of years.

And if all you ever do is hold on to them your high score looks great, the problem is that if rent comes due in USD in the middle of a down swing. What was 1M usd is now 100K usd and rent is now 1-2% of your bitcoin instead of .1-2%, if you get unlucky a few times that can start eating your holdings real quick. Medium to long term growth only matters in assets you won't need to spend in the short term.
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