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Spotting Scammy ICOs Before Parting With Crypto Coins In Crowdfunding

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Crowdfunding

Crowdfunding has become a popular means by which businesses get funds to start a business. However, the rising popularity of bitcoins has led to a new method of crowdfunding called Initial Coin Offering (ICO) that is different to the standard financial system that the market is used to.

What is an ICO?

Before going into the details of how to identify ICO scams, it is first important to understand the concept of an ICO. It is basically the crowdfunding that we all know but the difference is that ICOs are carried out through cryptocurrency. It is currently becoming very popular because it presents a new method for individuals and companies to fund their projects.

ICOs are advantageous because they have an easier and more efficient process compared to the traditional methods of crowdfunding. ICOs last about one or two weeks and sometimes even longer. During that duration, individuals and companies get to purchase tokens issued through the crowdfunding in exchange for cryptocurrencies such as ethereum or bitcoin.

Fake ICOs

ICOs have been growing more popular especially with the surge of major digital currencies such as Bitcoin. This highlights the fact that they are more efficient and easy to use for crowdfunding purposes. Numerous ICOs were launched about a week ago and this demonstrates just how popular ICOs have become. However, this has also led to new threats such as scams despite the allegedly secure nature of blockchain technology.

Generous bonuses

Investors view very new ICO that becomes available as a potential goldmine which means it could be the next big thing. This is because some major firms such as Uber or Airbnb got to where thy currently are through crowdfunding. For this reason, most investors are after the best bonuses that they can get through crowdfunding projects.

Most of the bonuses issued through ICOs are often based on the total investment and so investors sometimes pursue bonuses that are as high as 90 percent. These bonuses are thus an incentive for investors and so some scammers want to take advantage of this by offering generous bonuses. This is one of the tell-tale signs that an ICO could be a scam. Investors should thus avoid deals that seem too good to be true.

Adequate background checks

Scammers are often clever and often times end up being as good as the real deal. This means it is difficult to tell the true ones from the fake ones. It is thus important to employ other security measures. One of those measures should include an elaborate background check of the founders of the ICO to determine whether they have a good track record.

Legitimate founders will most likely have their footprint in other key areas thus meaning they can be trusted. It would not be a good idea to invest in a crowdfunding project whose founders have no prior experience in the field that they are venturing.

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.

Image courtesy of Rocio Lara via Flickr

Bitcoin

Bitcoin Surges After Tesla Bought $1.5 Billion Worth of BTC

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Cryptocurrency

The sudden rise of Bitcoin has been connected to the decision taken by the Tesla electric car company to buy $1.5 billion worth of Bitcoin.

The company explained in a filing with the Securities and Exchange Commission (SEC) that it bought Bitcoin to diversify its cash returns and more flexibility.

Musk’s Tweets also impacted Dogecoin’s price

Tesla also added that it will start accepting Bitcoin payments for all its products, although this will be based on a limited basis and applicable laws. If the company concludes and starts accepting cryptocurrency, it will make it the first major car manufacturer to accept Bitcoin payments. The company’s founder and Chief Executive Officer Elon Musk has developed an interest in Bitcoin and cryptocurrencies.

He has been tweeting severally about the viability of the Dogecoin (DOGE), which doesn’t have an important market value attached to it.

Few hours after endorsing Dogecoin, the cryptocurrency rose by an impressive 50%. But regulatory authorities are still concerned about the risks in cryptocurrency investments, with several regulatory bodies warning traders and investors they could lose all their money from crypto investments.

But for Tesla, the company decides to diversify its funds and increased its cash returns. However, Tesla also warned investors about the volatility of Bitcoin’s price in its SEC filing. According to the SEC…

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Altcoins

XNO Token of Xeno NFT Hub listed on Bithumb Korea Exchange

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Hong Kong, Hong Kong, 25th January, 2021, // ChainWire //

Xeno Holdings Limited (xno.live ), a blockchain solutions company based in Hong Kong, has announced the listing of its ecosystem utility token XNO on the ‘Bithumb Korea’ cryptocurrency exchange on January 21st 2021.

Xeno NFT Hub (market.xno.live ), developed by Xeno Holdings, enables easy minting of digital items into NFTs while also providing a marketplace where anyone can securely trade NFTs.

The Xeno NFT Hub project team includes former members of the technology project Yosemite X based in San Francisco and professionals such as Gabby Dizon who is a games industry expert and NFT space influencer based in Southeast Asia.

NFT(Non-Fungible Token) technology has recently gained huge focus in the blockchain arena and beyond, making waves in the online gaming sector, the art world, and the digital copyrights industry in recent years. The strongest feature of NFTs is that “NFTs are unique digital assets that cannot be replaced or forged”. Unlike fungible tokens such as Bitcoin or Ether, NFTs are not interchangeable for other tokens of the same type but instead each NFT has a unique value and specific information that cannot be replaced. This fact makes NFTs the perfect solution to record and prove ownership of digital and real-world items like works of art, game items, limited-edition collectibles, and more. One of the ways to have a successful trading…

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Bitcoin

Wisebitcoin Launches Professional-Grade Crypto Exchange

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Infrastructure is developing rapidly in the cryptocurrency industry, but the recent launch of the Wisebitcoin cryptocurrency exchange is nonetheless significant in terms of the immediate value it provides to cryptocurrency users. That’s because the exchange has had a beta version available since 2018 while continuing further developments in stealth mode, and already serves over 1.2 million end users with $6+ billion in 24 hour trading volume at the time of its official launch.

In addition to the large user base and deep liquidity, Wisebitcoin also stands out by offering up to 100x leverage to margin traders, with the ability to open a long or short position in their futures market. In the current bullish environment, leverage is a key way that experienced traders increase their exposure and try to profit from volatility.

For example, if a user opened a long position on ETH on January 2nd at a price of $750, they could have greatly multiplied their profits with even a small amount of leverage such as 5x as ETH reached over $1,100 within 48 hours. A simple unleveraged position would have netted $350 in profit, but a 5x position would have netted $1,750 and a 100x leveraged position would have netted an incredible $35,000 in profits from an initial investment of just $750. 

Beyond leverage, Wisebitcoin additionally offers a simple and…

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