Best Ways To Detect An ICO Scam

2019 has proven to be quite successful for the initial
industry of coin offers. This is despite the fact that some of the key risks and
pitfalls associated with ICO
list
still remain. With so many new investors joining the risk, the following five
best practices should be taken into account at all times. It is urgently
necessary to sacrifice the weeds of straw in the ICO industry.

 

Non-professional
language

 

Any project or company that boasts and wishes to raise
funds through an ICO must ensure that the wording on its website is
professional. Any website that has flagrant spelling errors or an obvious case
of " Engrish" can hint at a possible scam in the first place. While spelling
errors can happen to anyone, an initial coin offer that tries to raise millions
should never look unprofessional.

 

Fake
Business Address

 

Companies seeking to adopt transparency will often put
their business address on the ICO website or technical documentation. A quick
Google Maps search can often yield valuable information about the address and
whether or not it can be verified effectively. The rented offices are not
necessarily a scam, but an address that does not seem to be able to house a
promising company can be a clear indicator that something is wrong.

 

Fake
Advisors

 

Each
initial offer of coins will come with a list of people advising the team at all
times. That usually indicates that these individuals have investigated the
project at some point and are willing to help it grow accordingly. Although
this is an intelligent business approach, there have been numerous problems in
this regard over the years. Adding fake advisors to an ICO tends to happen more
often than people assume. Always be prepared to personally contact these
advisors, or at least see if your Linkedin profile mentions the ICO to verify
if they are really associated with the project.

 

Unsustainable business promises

 

In the world
of cryptocurrencies and initial offers of currencies, not all projects are
created equally. There will be many promising companies that are completely
legitimate, but there is also a good chance that some of the lists will focus
mainly on get-rich-quick schemes. When the latter happens in the world of ICO,
unfortunately it will not be the investors who will get rich quickly.
Especially in this day of safety versus utility tokens, any promise that seems
too good to be true should be avoided.

 

There is no
proof of concept although things are improving in this regard, there are still
numerous initial offers of currencies that do not understand that they must
offer proof of concept in the first place. Having a technical document is the
easy part, since teams can buy them at Fiverr for a cheap price. That alone is
not enough to take a project to the legitimate side of the spectrum, mainly
because writing something and actually building it are two very different
things.

 

As
such, any initial currency offer without proof of concept should not even
attempt to raise money. Unfortunately, that's not the way the industry works
these days, since most of the initial coin offers will not have a work code
before they raise millions of dollars. It is still a great bet to invest in
such projects, although there may still be numerous offers that are perfectly
fine without a prototype. Careful project research is always a good idea.