We would like to inform our readers about a consumer alert issued by the Irish Central Bank in relation to Initial Coin Offerings (aka Token Sales aka ICOs) which have become one of the major uses of cryptocurrencies in the last year, especially ERC-20 tokens on the Ethereum Blockchain. These are used by a number of companies to raise funds for projects, of varying quality, and for which a number may turn into scams or vapourware, while others may help get some pretty complex platforms developed. TLDR, be careful and do your research before investing anything in these, and don’t bet your house on them. Some people have made a lot of money from flipping token sales on exchanges, but equally many, many tokens have dropped considerably in value straight after launch.
The full release is available at https://www.centralbank.ie/consumer-hub/consumer-notices/alert-on-initial-coin-offerings
Alert on Initial Coin Offerings
Information Notice December 2017
Consumers are alerted to the high risks associated with Initial Coin Offerings.
An Initial Coin Offering or “ICO” refers to a new means of raising money from the public, using so-called “coins” or “tokens”. These coins or tokens are issued in exchange for traditional currencies, such as the euro, or more often, virtual currencies e.g. Bitcoin or Ether.
ICO campaigns are conducted online, using the internet and social media.
Investors should be aware that they are exposed to the following risks when investing in ICOs:
Unregulated activity, vulnerable to fraud or illicit activities
High risk of losing all invested capital
Lack of exit options and extreme price volatility
Flaws in the technology
European national supervisory authorities, including the Central Bank, contributed to the production of the ESMA statement, which was published on 13 November 2017.
Our site is funded by affiliate links and advertising. If you sign up or purchase through links on our site we may receive remuneration. If you found something useful on our site, we accept BTC donations to 3F5utdL2U7rVou8gTJDBmQp167CDiEeENW, BCH to bitcoincash:qrfuyy8qk2eyjnzfufuvlaqcxjmg0qr8d564ztnd3d, ETH/tokens/stablecoins to 0xdEe0763fdb2FcFb0e65E5a3A035a77DC1425715A or tips via Brave.