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Wolf of Wall Street: Cryptocurrency ICOs Are 'the Biggest Scam Ever' (betanews.com)
An anonymous reader shares an article: Jordan Belfort -- the real-life Wolf of Wall Street -- has warned that ICOs (or "token sales" or "coin sales") are "the biggest scam ever" and will "blow up in so many people's faces." The former stockbroker, who spent nearly two years in prison for fraud and financial scams, says that the Initial Coin Offerings used to raise money for cryptocurrencies are "far worse than anything I was ever doing." His fears seem to stem from the way ICOs differ from the more traditional IPO. With IPOs investors gain shares in whatever company they plough money into, and profits can be easily shared. With ICOs, however, there is no mechanism in place for distributing any profits that may be made, profits are reliant on the value of a given cryptocurrency increasing and, perhaps more worrying, ICOs are not regulated in the way IPOs are. Aside from the fact that some ICOs are out-and-out scams, many people believe that the cryptocurrency bubble is just that -- a currently growing bubble that will eventually pop, leading many people to lose out.
Seems like there are a very few worth currencies and the rest are Me-Too currencies that are only out there for pump and dump.
Really the only worthwhile currencies are those that you can use with a legit bank or a retail store. Anything else, buyer beware.
Because a scammer knows a scam when he sees one.
Why should we listen to you instead? What are your accomplishments?
A crypto currency is a very convenient way to store and move money. Banks will charge 5% or more to convert your money from one currency to another and wire transfers are a pain and usually cost $10. Other money transfers often come with 1 or 2% fees and banks in some countries are corrupt and incompetent. Crypto currencies could replace a good portion of M2 since they work better than most traditional money. M2 world wide is equivalent to almost 30 Trillion USD. One day one crypto currency will likely approach this amount. ICOs are a scam. They replace shares but are inferior in almost every way except they by-pass the traditional stock markets. (I suppose some conspiracy people might think this is a good idea). ICOs also don't allow high frequency trading since trades can only take place as fast as blocks are added to the block chain and buried to a sufficient depth to be trusted.
Crypto currencies are a lot of things. "Convenient" is not among those things. I've tried several times to use bitcoins but it's a total pain in the ass, so I own zero bitcoins. Bitcoin? more like shitcoin. I'm joking, but seriously - bitcoin has to be the world's least convenient way to pay for anything.
I'm surprised you can't access your Bitcoin but you can access Slashdot.
He can probably access his bitcoin just fine - he just can't find anyone who will give swap his bitcoins for food.
I'm a minority race. Save your vitriol for white people.
He can't buy what he needs with it. The local markets don't take bitcoin. It is not a liquid currently, nor is it easily convertible.
Starships were meant to fly, Hands up and touch the sky - Nicky Minaj
I got a message on social media from a long time friend. We've been friends since elementary school. He's an educated man but somehow, someone got their hooks into him with regards to some new crypto coin offering. He was trying to convince me to go all in on it with him. I'm sure that he believes in this. I hope I'm wrong about it but the whole deal doesn't smell right.
The website he directed me to visit for more information consisted of a hosted blog page that was exceptionally light on details of the crypto, the infrastructure and the people behind it.
Crypto coins seem to be becoming the MLM of the next decade.
LK
"Hi. This is my friend, Jack Shit, and you don't know him." - Lord Kano
I have zero sympathy, especially given the amount of warning these people have had.
Agreed. I was fairly warned that Bitcoins were overpriced when they reached $1, again at $100, again at $1000, and finally when they recently crossed the $5000 mark. I have no problem with your lack of sympathy for my predicament.
Ohh you got me there. Just because bitcoin looks and acts like every speculative bubble ever doesn't mean it is one, right?
A good rule of thumb for what is a speculative bubble: When the value of something dramatically increases without an answer to the question, "why". (aside from the below key factors in a speculative bubble):
Displacement: A displacement occurs when investors get enamored by a new paradigm, such as an innovative new technology or interest rates that are historically low.
Boom: Prices rise slowly at first, following a displacement, but then gain momentum as more and more participants enter the market, setting the stage for the boom phase. During this phase, the asset in question attracts widespread media coverage. Fear of missing out on what could be an once-in-a-lifetime opportunity spurs more speculation, drawing an increasing number of participants into the fold.
Euphoria: During this phase,caution is thrown to the wind, as asset prices skyrocket. The "greater fool" theory plays out everywhere.
Valuations reach extreme levels during this phase.
During the euphoric phase, new valuation measures and metrics are touted to justify the relentless rise in asset prices.
Profit Taking: By this time, the smart money – heeding the warning signs – is generally selling out positions and taking profits. But estimating the exact time when a bubble is due to collapse can be a difficult exercise and extremely hazardous to one's financial health, because, as John Maynard Keynes put it, "the markets can stay irrational longer than you can stay solvent."
Panic: In the panic stage, asset prices reverse course and descend as rapidly as they had ascended. Investors and speculators, faced with margin calls and plunging values of their holdings, now want to liquidate them at any price. As supply overwhelms demand, asset prices slide sharply.
I'm not hating on bitcoin and actually think it will open up some new avenues to challenge the credit card companies to be more competitive but the irrational exuberance sucks people in and it hurts them, especially when highly speculative vehicles like ICOs are looking to cash in on it.
Invest in the stock market, and you become a fractional shareholder in a real company. If the company does well, you do well, it's joint ownership. Invest in a cryptocoin, then you're not really "investing", but you're speculating, gambling, etc.