Ico crypto 2020

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Content:

• Tokenization: The world of ICOs
• What Are The Risks Of An ICO in 2022?
• Initial Coin Offerings
• ICO Mania Revisited: The Investors and Token Issuers Who Made Good
• New Kids on the Blockchain
• Why do ICOs Fail? Are They Still Worth Investing in 2019-2020?
• Subscribe newsletter
• ICObench — №1 ICO rating platform

WATCH RELATED VIDEO: SECRETS To Finding a 100x Token Sale!! ✅

Tokenization: The world of ICOs

Financial intermediation versus disintermediation: Opportunities and challenges in the FinTech era View all 9 Articles. Initial coin offerings ICOs are one of the several by-products in the world of the cryptocurrencies. Start-ups and existing businesses are turning to alternative sources of capital as opposed to classical channels like banks or venture capitalists.

The investors, of course, hope for an increase in the value of the token in the short term, provided a solid and valid business idea typically described by the ICO issuers in a white paper. However, fraudulent activities perpetrated by unscrupulous actors are frequent and it would be crucial to highlight in advance clear signs of illegal money raising.

In this paper, we employ statistical approaches to detect what characteristics of ICOs are significantly related to fraudulent behavior. We leverage a number of different variables like: entrepreneurial skills, Telegram chats, and relative sentiment for each ICO, type of business, issuing country, team characteristics. Through logistic regression, multinomial logistic regression, and text analysis, we are able to shed light on the riskiest ICOs.

Initial Coin Offerings ICOs can be considered as an innovative way of obtaining funding, promoted by entrepreneurial companies that base their business projects on a new technology known as blockchain. Up to the present date, more than 1, cryptocurrencies have been created but not all of them are successful or characterized by a significant impact. Tokens can be bought directly on the web platform of the company, at different stages of the ICO commonly referred as pre-sale and sale.

Later, the amount of bought tokens can be sold or used in the future to obtain products or services. The portal Tokendata. When we say cryptocurrency, we refer to a digital currency, a new means of exchange, the most popular examples of which are Bitcoin and Ethereum. Blockchain chain of blocks is the technology at the basis of a cryptocurrency; it is a Distributed Ledger Technology defined as a distributed, shared, encrypted database that serves as an irreversible and incorruptible repository of information Wright and De Filippi, ICOs favor open-source project development and decentralized business, generating a built-in customer base and positive network effects.

They also create a secondary market where tokens can be employed as rewards for using the app of the company or the offered services Subramanian, This work aims at addressing the specific characteristics of ICOs using relevant variables that play a key role in determining the success of the ICO.

As it stands there is no database with the information we are looking for, thus we have been building and constantly maintaining a dataset that is currently composed of ICOs that occurred between October and November Cerchiello et al. The most common sectors in which ICOs operate are: high-tech services, financial services, smart contract, gambling platforms, marketplaces, and exchanges.

Most of the ICOs projects are related to the development of a blockchain, the issuance of new cryptocurrencies or somehow related fintech services.

ICOs tokens grant contributors the right to access platform services in The success of such decentralized technology lays on the fact that it works without the commitment and the control of a central authority: the blockchain is a Peer-to-Peer technology. A Peer-to-Peer P2P system represents a way of structuring distributed applications such that the individual nodes can act as both a client and a server.

A key concept for P2P systems is to allow any two peers to communicate with each other in such a way that either ought to be able to initiate the contact Peer-to-Peer Research Group, Then, the more a P2P network is distributed, scalable, autonomous, and secure, the more is valuable.

All of these precious features have enabled the fast growth of cryptocurrencies not just per se but also as a tool for crow-funding purposes, giving birth to the so-called Initial Coin Offerings.

Moreover, what is further fueling the development of ICOs, according to BIS Annual Economic Report is the absence of regulation even if many countries are currently working on it and, at the moment, there are just a few examples of banning acts namely China, India, South Korea.

Investors buy ICO tokens in the hope of very high returns, sometimes even before the business is put in place, since the corresponding cryptocurrencies typically Ethereum can be immediately traded. In , the total amount raised by ICOs was about 4 billion US and overcame venture capital funneled toward high tech initiatives in the same period. The first token sale was held by Mastercoin in July but one of the most successful and still operative is Ethereum which raised 3, BTC in its first 12 h in , equal to approximately 2.

Recently, there has been a growing literature studying the ICOs drivers aiming to predict their future outcome. A previous study offers an exploratory empiric classification of ICOs and the dynamics of voluntary disclosures. It examines to what extent the availability and quality of the information disclosed can explain the characteristics of success and failure among ICOs and the corresponding projects Blaseg, Another important research focuses on the effectiveness of signaling ventures and ICOs projects technological capabilities to attract higher amounts of funding Fisch, Momtaz aims at identifying the likelihood and possible timeframe of value creation for investors by combining several factors financial return, amount of capital raised, listing, and delisting alternatives, industry events study etc.

Other streams of research concentrate on the impact of managers quality on the ICOs. Momtaz studies the impact of CEOs loyalty disposition and the magnitude of asymmetry of information between managers and investors on ICOs performance Momtaz, b. Moreover, to remain in the management area, an interesting spark comes from a research specifically directed on CEOs role and effects on ICOs results Momtaz, c.

Finally, another area of studies focuses on the driving factors impacting the liquidity and trading volume of crypto tokens listed after the ICOs. Among those factors have been identified the quality level of disclosed documentation source code public on Github, white paper published, an intended budget published for use of proceeds , the community engagement measured by the number of Telegram group members , the level of preparation of the management using as proxy the entrepreneurial professional background of the lead founder or CEO , and other outcomes of interest i.

Despite the interest that has been peaked by ICOs and the constantly growing trends, it is worth mentioning that almost half of ICOs sold in failed by February Hankin, In fact, what should drive more attention to ICOs is the consistent presence of scam activities only devoted to raising money in a fraudulent way.

On the other hand, it is interesting to assess what factors affect the probability of success of an ICO. Adhami et al. The boom of the ICOs projects and their interesting characteristic brought an important rise of interest from the general audience, many scientific studies have been conducted and published in the last years. Besides the aforementioned Adhami et al.

Recently, Subramanian in quoted the ICOs as an example of the decentralized blockchain-based electronic marketplace. The main source of information about blockchain, tokens, and ICOs is obviously the Web. Here we can find sites enabling to explore the various blockchains associated to the main cryptocurrencies, including Ethereum's one.

We can also find websites giving extensive financial information on prices of all the main cryptocurrencies and tokens, sites specialized in listing the existing ICOs and giving information about them.

Often, these sites evaluate the soundness and likeliness of success of the listed ICOs. One of the most popular among these sites is icobench. ICOs are usually characterized by the following features: a business idea, most of the time explained in a white paper, a proposed team, a target sum to be collected, a given number of tokens to be given to subscribers according to a predetermined exchange rate with one or more existing cryptocurrencies. On top of all the characteristics explained so far, there is a further and not yet explored point of interest: the Telegram chats.

Telegram is a cloud-based instant messaging and voice over IP service developed by Telegram Messenger founded by the Russian entrepreneur Pavel Durov.

If Telegram were a country, it would have been the sixth largest country in the world Telegram, Some characteristics are imposing Telegram among the first social networks, indeed it intentionally does not collect data about where its clients live and what they use the platform for. This is one of the main reason why, according to AppAnnie rankings, Telegram is particularly popular in countries like Uzbekistan, Ukraine, and Russia, where Internet access may be limited or closely monitored by the government.

This means that retrieving Telegram discussions associated with each and every ICO would produce a huge amount of textual information potentially useful for understanding the chance of success and more interestingly possible signs of fraudulent activities.

In this paper we leverage two kinds of information: structured and unstructured ones. Regarding the former, we take advantage of classical statistical classification models to distinguish the stauts of an ICO that made up of 3 classes, intended as follows:. A robustness check for the scam labeling come by checking if regulatory bodies announced legal actions against the issuers e.

It follows that the probability of success or scam can be obtained as:. Since the target variable is naturally categorized according to three classes, success, failure, and scam we extend the aforementioned binary logistic regression to a multinomial one.

Such model assesses all the categories of interest at the same time as follows:. Considering the textual analysis of Telegram chats, we take advantage of quantitative analysis of human languages to discover common features of written text. In particular the analysis of relatively short text messages like those appearing on micro-blogging platform presents a number of challenges. Some of these are, the informal conversation e.

Moreover, it is important to consider the high level of noise contained in the chats, witnessed by the fact that only a fraction of them with respect to the total number available is employed in our sentiment analysis. We have applied a Bag of Word BoW approach, according to which a text is represented as an unordered collection of words, considering only their counts in each comment of the chat.

The word and document vectorization has been carried out by collecting all the word frequencies in a Term Document Matrix TDM. Classical text cleaning procedures have been put in place like stop-words, punctuation, unnecessary symbols and space removal, specific topic words addition.

For descriptive purposes we have used word-clouds for each and every Telegram chat according to the general content and to specific subcategories like sentiments and expressed moods. The most critical part of the analysis relies on the sentiment classification.

In general, two different approaches can be used:. However, the second option is rarely feasible because in order to fit a good classifier, a huge amount of pre-classified examples is needed and this represents a particularly complicated task when dealing with short and extremely non conventional text like micro-blogging chats Cerchiello and Nicola, Insofar, we decided to focus on a dictionary based approach, adapting appropriate lists of positive and negative words relevant to ICOs topics in English language.

These lexicons are based on unigrams, i. The BING lexicon categorizes words into a binary manner into positive and negative categories. By applying the above described lexicons, we produce for each and every ICO a sentiment score as well as counts for positive and negative words. All these indexes are used as additional predictors within the logistic models. For each project, we gather information from web-based sources, mainly rating platforms such as icobench.

The process of building up the ICOs data set reflects the main phases that an ICO follows to be launched: from the birth of the business idea, the team building, the purpose of the tokens, the technical requirements white paper , the promotion and the execution phase. The first step in collecting data about each project is to gather information from the most used ICO related platforms as Icobench, TokenData, Coinschedule, or similar.

During such phase, we look for general characteristics such as the name, the token symbol, start, and end dates of the crowdfunding, the country of origin, financial data such as the total number of issued token, the initial price of the token, the platform used, data on the team proposing the ICO, data on the advisory board, data on the availability of the website, availability of white paper and social channels.

Some of these data, such as short and long description, and milestones are textual descriptions. Others are categorical variables, such as the country, the platform, and variables related to the team members name, role, group.

The remaining variables are numeric, with different degrees of discretization. Unfortunately, not all ICOs record all variables, so there are several missing data. The ICO web databases that we use are fully checked in order to minimize the missing values of one of the platforms, therefore we validate the information checking for the details on the website and on the white paper.

As a result, the complete set of reliable information comes from the matching between the website and the white paper. The variables set, continuous and categorical data, show us that the main area of origin of the projects is Europe with the highest percentage in Switzerland and Germany.

FINMA does not categorize payment or utility tokens provided they are not used for investment as securities. All other tokens are categorized as securities and are subject to securities regulation. If a debt token can be classified as a deposit, then unless specific exceptions apply, a banking license is needed prior to the ICO. On the development of the dataset the research focused also on assessing the number of advisors for each ICO, checking their educational background and marking as a variable of interest the presence of a Ph.

The evolution of the classic Business Plan that we observe when we analyse the idea of a start-up, is called White Paper. The business plan is the document that illustrates the strategic intentions and the management of competitive strategies of the company, the evolution of key value drivers and the economic and financial results.

What Are The Risks Of An ICO in 2022?

What are the conditions to be complied with to obtain approval for an initial coin offering ICO? How to submit my draft information document to the AMF? Find here all the useful information for preparing your transaction. An Initial Coin Offering ICO may be defined as a fundraising transaction carried out through a distributed register system or "blockchain" and resulting in a token issue.

Initial Coin Offerings

Financial intermediation versus disintermediation: Opportunities and challenges in the FinTech era View all 9 Articles. Initial coin offerings ICOs are one of the several by-products in the world of the cryptocurrencies. Start-ups and existing businesses are turning to alternative sources of capital as opposed to classical channels like banks or venture capitalists. The investors, of course, hope for an increase in the value of the token in the short term, provided a solid and valid business idea typically described by the ICO issuers in a white paper. However, fraudulent activities perpetrated by unscrupulous actors are frequent and it would be crucial to highlight in advance clear signs of illegal money raising. In this paper, we employ statistical approaches to detect what characteristics of ICOs are significantly related to fraudulent behavior. We leverage a number of different variables like: entrepreneurial skills, Telegram chats, and relative sentiment for each ICO, type of business, issuing country, team characteristics. Through logistic regression, multinomial logistic regression, and text analysis, we are able to shed light on the riskiest ICOs. Initial Coin Offerings ICOs can be considered as an innovative way of obtaining funding, promoted by entrepreneurial companies that base their business projects on a new technology known as blockchain. Up to the present date, more than 1, cryptocurrencies have been created but not all of them are successful or characterized by a significant impact.

ICO Mania Revisited: The Investors and Token Issuers Who Made Good

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New Kids on the Blockchain

A year ago, we reported that the ICO Initial Coin Offering bubble had burst — just as we had predicted already in This was pretty easy to foresee, even though we did get a bit of hate mail from ICO fanatics along the way. The ICO bubble grew to a significant size before it burst :. Bitcoin like most other cryptocurrencies is based on a decentralized, public ledger technology called the blockchain. Early blockchain implementations have faced scaling issues: Bitcoin can process about 5 transactions per second, Ethereum about 25 transactions per second.

Why do ICOs Fail? Are They Still Worth Investing in 2019-2020?

A company seeking to raise money to create a new coin, app, or service can launch an ICO as a way to raise funds. Interested investors can buy into an initial coin offering to receive a new cryptocurrency token issued by the company. This token may have some utility related to the product or service that the company is offering, or it may just represent a stake in the company or project. When a cryptocurrency project wants to raise money through ICO, the project organizers' first step is to determine how they will structure it. ICOs can be structured in a few different ways, including:.

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There's a certain class of crypto denizen who derides anything that isn't bitcoin as garbage, and the long bear market that started in early certainly seemed to support that view. We're in a different time now where much of the work funded by the largest ICOs has been deployed. Those products now have at least a base of users and their token prices reflect it.

ICObench — №1 ICO rating platform

RELATED VIDEO: The SEC and ICO Regulation

Just like the returns on an investment in an ICO can be huge, so too can the risks. What are the hazards of participating in ICOs? The market is still under-regulated. That means investors may be left on their own if an ICO turns out to be a Just like the returns on an investment in an ICO can be huge, so can be the dangers.

Here's What Investors Should Know. Ethereum Just Hit a 6-Month Low. Upgrade Bitcoin Rewards Card: 1. There Are Thousands of Different Altcoins. Megan DeMatteo is an editor and poet based in New York. In she helped launch CNBC…. Quigley, a prominent investor and co-founder of the WAX blockchain.

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