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Author: Admin | 2025-04-28
Of dollars through its ICO. Investors will legitimately send money to an anonymous address online – even if there’s no product in place, or any evidence the company is legitimate. Many ICOs are complete scams, and they’ll run away with investors’ money immediately after the ICO is complete.Security Concerns: There have been numerous cases in the crypto community of companies raising a lot of money through ICOs – only to watch that money disappear due to a security breach, a smart contract error, or a hack. The DAO famously lost $50 million of investor deposits, for example, and Parity wallet hacks have led to the loss of millions of dollars in ICO funds. ICOs are far from perfect – and security is one of the major causes of concern. Any time you have a single account or fund holding $50 million or more, it poses an enormous target to every hacker in the world. Eventually, someone is going to break through.Token Storage: When you buy stocks and traditional financial instruments, you probably hold the funds in your investment account or bank. You don’t need a special wallet, and you don’t need to download special software. ICOs, however, are different. You need a storage system for your coins – like an ERC20-compliant wallet.Network Congestion: There’s one final issue to mention with ICOs, and that issue is network congestion. Network congestion can cause major problems for ICOs – particularly if the token sale has generated a lot of hype. In many cases, companies have scheduled 30 day ICOs, only to watch the token sale be over in 20 minutes after all tokens were sold out. In one famous case, an AirSwap investor lost $80,000 on a failed transaction because the company had sold out of tokens by the time the transaction was complete. The money was returned to the investor, but the investor was stuck with the transaction fee.Overall, many of the benefits of ICOs are here to stay, and many of the problems – like security and unclear regulation – can easily be fixed in the future. ICOs have proven to be an effective and unique crowdfunding mechanism, and that probably means they’re going to stick around for a long time.TYPES OF BLOCKCHAIN COMPANIES: WHAT DO ICO COMPANIES DO? Blockchain companies are kind of like “dot com” companies in the 1990s.Is there a current industry that can be disrupted through the
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