ICO = Inevitable Coin Obliteration?
The idea, as is standard with ICOs, was that rather than shares in the company, investors would receive tokens they could spend on using the product, or sell – hopefully at a markup – to other customers.
As Digipulse explains: “Out of the 320 service sign-ups we’ve had until July 25th, only 2 people have actually allocated tokens to the service, meaning that only 2 people have actually used the DGPT token for its main purpose.”
Everyone else, it seems, was simply speculating on the coin rising in value so they could sell it at a later date.
Anyone could have seen this coming. The smell of ‘get rich quick’ schemes and goldrush-like speculation taints most serious attempts to do interesting things with cryptocurrency and blockchain tech. No wonder so many companies that raised money via ICOs last year are already dead
. Some were scams all along, and others were a case of misguided entrepreneurs thinking they could change the world simply by using a blockchain where one was never needed.
After the dotcom crash of 2000, it took a couple of years, but the internet technology scene began to bounce back with 'web 2.0’ products and a series of innovations that led to the smartphone and the world we have today.
It’s likely we’ll see a similar situation with cryptocurrencies and blockchain. The prospectors will move on to the next easy-money fad, and the people working on serious technology will develop uses for it that aren’t just a case of bolting a token onto a business that doesn’t need it.
But I suspect quite a few people will lose big money along the way, and sadly it won’t be the scammers.