Tired of finding that perfect blockchain project to invest in only to find out later that it’s a scam, especially after you’ve invested your hard-earned money? You’re not alone.
To say the current blockchain ecosystem is frenetic would be mild. The activity is mind-boggling. Sifting through all the Ethereum dapps or keeping up with market caps could be a full-time job. Is your head spinning yet? In an unregulated marketplace with so many moving pieces, what’s an investor to do?
Is the Ethereum Community About to Tame the Wild, Wild West?
In Devcon3, held in Cancun Mexico on 1 November 2017, there was much to-do about the current blockchain world. Luminaries such as Fabian Vogelsteller have stated that the non-blockchain world is putting too much emphasis on tokens and ICOs. In reality, the emphasis should be on products that solve problems. People are putting the cart before the horse, in other words.
The Ethereum community is proposing that at the very least an individual or company should have a working prototype before selling tokens or announcing an ICO. Britain’s Jez San, CEO of online casino startup FunFair is quoted as saying:
When you describe a technology [very few] can understand, you can hoodwink people. People throw money at it, you raise $100 million dollars and still don’t know how to build it.
Sound familiar? Hmmm? Where have we heard that before? Isn’t that what recently happened at Bancor? Bancor had all the right credentials, and their ICO was off-the-charts successful. But they made one tiny miscalculation: no working prototype.
With some running around like Henny-Penny screaming the sky’s falling and others wondering what all the fuss is about and saying this is perfectly normal, one needs to step back and look at the broader implications here: in the non-blockchain world, this behavior would constitute fraud, which is why laws have been enacted to protect investors.
Why ICO Standards Are A Good Idea
If we want to keep the blockchain ecosystem distributed and decentralized, staying in the hands of the many instead of being controlled by the few, we’ve gotta do a better job of policing our own space. If we don’t, outside forces will step in to do it for us.
This is a perfect first step. Due to the unprecedented and exponential blockchain and crypto-asset growth, with particular emphasis on the ICO market, it may be time for the community to step in and introduce standards to help protect consumers and stem the tide of fraud and failed projects. This is what the community is doing.
We, as investors, have just as important a part to play as well. We vote with our money, or lack thereof.
Unless there’s a valid reason, if a project doesn’t have a working prototype . . . keep your money.