Bitcoin will always be one of the most innovative developments in the history of money. Bitcoin, as the first decentralized digital asset, proved that it is possible for something intangible, with no issuer and no backing, to have a trillion-dollar market. The popularity of Bitcoin as a payment network and a new kind of money not only attracted fintech pundits, but also traders and investors looking to exchange fiat money to digital assets in hopes of making a profit as prices advance.
Because of the demand for digital assets, Bitcoin’s existing concepts had been used as a reference to develop more cryptocurrencies that contributed to the creation of many marketplaces that allow trading in digital currencies. Projects like ETH, EOS, and TRON are also major contributors in the expansion of the cryptocurrency space. By enabling developers to create their own coins through a main network (mainnet), these projects are responsible for paving the way for new cryptocurrencies to emerge.
Although cryptocurrency’s technical contributions are truly innovative and beneficial, there are many negative aspects that arose due to an existing gap in the cryptocurrency industry; the lack of Initial Coin Offerings (ICOs).
Ever since the first token sale by Mastercoin in July 2013, many ICOs followed. One of the most notable ICO is Ethereum’s ICO that raised 3700 BTC (approximately $2.3 million during that time) in the first 12 hours. More and more ICOs report success in raising funds, but now more than ever, cryptocurrency investors know that it’s not all positive since it has caused financial loss as well.
Despite having successful ICOs, it has been criticized as a mechanism used to commit fraud.
There are many investors who became victims to scammers who are applying a “pump and dump” scheme in which the scammers boost their ICO through marketing and promises of future profit, and then cashes out by dumping the coin. In this situation, investors are left to suffer with huge financial losses.ADN_whitepaper_version_1.0