As of the end of June 2018, there are more than a thousand cryptocurrency projects that actually ceased to exist. Among the main characteristics of such projects are: no hints of any developments or future activity, as well as frank scams, including BRIG, the fraudulent project of the brothers Jack and Jay Brigov, Titanium, whose investigation is handled by the Securities and Exchange Commission USA (SEC), CryptoMeth, Droplex, OreoCoin and RouletteCoin. It is noteworthy that all these dead projects attracted several billion dollars of investment.
As the newspaper notes, despite the fact that financial regulators of different countries constantly check the issuers of tokens for legitimacy, amateur investors often neglect the basic rule, which requires at least an initial analysis of the project, and invests millions of dollars in extremely questionable coins.
In addition to the widespread “disappearance” of project authors and “hacker attacks”, there are also very exotic legends of closing sites, for example, the sudden “death” of developers.
The results of the Satis Group study showed that in fraudulent ICO in 2017 they collected more than $ 1 billion. 271 projects were convicted of plagiarism when drafted in white paper, had employees who pretended to be other people, or conducted other dubious activities.
An additional study showed that only 8% of the tokens after ICO were able to get to the well-reputed exchange.
“Clearly, the ICO market is full of hype and fraud. According to my observations, 80% of projects were fraud, and 10% lacked content, which is why they “died” immediately after receiving funding. It is likely that most of the remaining 10% of projects will also fail, “Bloomberg financial analyst Aaron Brown said.