We all know that not every cryptocurrency is built to last. However, one math lately showed that token projects and forked digital currencies which are abandoned, shut down and scammed come in a greater number than people may think.
According to recent data from Cryptoispy , Coinopsy and Dead Coins (two cryptocurrency tracking websites), around 1,000 crypto projects are lacking any development or future activity in their protocol. As such, they have raised billions of dollars worth of BTC and ETH.
And while the law enforcement may have scrutinized hundreds of token issuers in order to determine their legitimacy, many amateur investors are lacking the basic due diligence. There are people who made a million dollar investments in coins whose name are enough to ring the alarm bells – such as CryptoMeth, OreoCoin, and Snowballs.
According to Aaron Brown who is a business markets author for Bloomberg:
“There has obviously been significant fraud and hype in the ICO market. I have seen 80 percent of ICOs were frauds, and 10 percent lacked substance and failed shortly after raising money. Most of the remaining 10 percent will probably fail as well.”
As we previously reported, ICO frauds have topped over $1 billion in 2017 with over 271 analyzed companies that rife with questionable operations, plagiarized white papers and impersonated team members. On top of this, additional research has shown that only 8% of cryptocurrency projects make it to reputable exchanges after their ICOs.
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