The Bitcoin – world’s most popular cryptocurrency – has been the protagonist of what some people call ‘a speculative bubble’ that made it reach an All-Time high of US $ 20,000 per coin; a milestone that certainly motivated a significant amount of enthusiasts to get involved into this blockchain frenzy. However, over the course of this year it has lost near to 70% of said value, causing the disappearance of several minor cryptocurrencies – at least indirectly.
According to a report by the website Dead Coins, the price per token of more than 800 different cryptocurrencies is quoted below $ 0.01 as of today. A large number of them didn’t meet their respective initial coin offerings (ICO) goals, while other were victims of piracy, or simply were scams. Consequently, people stop investing on them.
ICOs have become one of the most important steps in the creation of a new token. During the process, interested investors buy the digital coin offered by their respective startups, with the purpose of raising funds for the launch of a determined product or service.
Likewise, the web page Coinopsy registered details of 255 cryptocoins that have failed following their ICOs. Some examples are BitConnect, which suffered the loss of value early this year. Similarly, Titanium Blockchain Infrastructure Services (TBIS) just disappeared after its founder was accused of fraud, following a significant raise of funds via an ICO.
These popular forms of crowdfunding already pose a high risk for investors, aggravated by numerous scammers that take advantage of the hype around ICOs. Hence the utmost importance of being cautious and investigating well these new projects that arise before deciding what to invest.
Among the most controversial, there is the PlexCoin case, an ICO that was suspended on December, 2017, by the US Securities and Exchange Commission (SEC), in response to an official complaint in which its founder, Dominic Lacroix, was scamming American and Canadian investors.
Because of these scandals, several technological entrepreneurs have distanced themselves from the blockchain phenomenon. One of them is Microsoft founder Bill Gates, who made public his rejection to cryptocurrencies in several instances – especially because he considers they are used for malicious goals, pointing that he would prohibit their circulation if he could.
On the contrary, there is software security expert and tycoon John McAfee, who has shown himself extremely receptive with digital currencies, to the point of taking advantage of them through controversial predictions have encouraged several companies and crypto-exchanges to reconsider their stances and to invest in some virtual coins, even if such predictions do not become reality.