ICOs: Scams or Legitimate Investments?

ICOs: Scams or Legitimate Investments?

According to a recent study, as many as 80 percent of the ICOs conducted in 2017 can be considered scams. But are all ICOs bad and what are the best ways to invest in cryptocurrencies?

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  • ICO is short for initial coin offering, and they are used by developers to raise money for new cryptocurrencies. The problem with ICOs is that they aren’t regulated like company IPOs, and many are used as fronts for scam operations.

  • Based on statistics, ICOs are not lucrative investments and many experts including the SEC encourage investors to stay far away from them.

  • A majority of ICOs in 2017 had failed before the year was even over and we are seeing similar patterns this year.

A recent study conducted by the ICO firm Statis Group revealed that as many as 80 percent of last years ICOs should be considered scams.

The study evaluated several aspects such as the lifecycle of the ICO, how long it took before the cryptocurrencies were listed and delisted on an exchange, and whether or not more code was added to the projects after the official launch. The result shows that only 20 percent of all the ICOs in 2017 were actual projects with an honest plan and goal.

Luckily, it seems like most traders have the ability to spot the scams and avoid investing in failing projects. Only 11 percent of all the money invested in ICOs last year actually went to scams while the remaining 89 percent was invested in real projects.

Still, many of the legitimate ICOs end up failing and in 2018 most ICOs that have been conducted have already disappeared. What this tells us is to avoid ICO investments and only focus on stable projects like Bitcoin.

How to Invest in Cryptocurrencies While Avoiding ICOs

We encourage all of our readers to be careful with ICO investments, and we advise you guys to invest smarter. The most common way of investing and trading with cryptocurrencies is through cryptocurrency exchanges such as Binance, Huobi, Hodly, and Coinbase or trading tools such as Robinhood.

Although, our favorite way of trading cryptocurrencies is with regulated CFD brokers. CFD trading allows you to speculate on the prices instead of buying the actual asset which makes the process much easier.

The following brokers are the best for cryptocurrency trading:

  • IQ Option has been an important force in the cryptocurrency space for quite some time now, and this broker remains one of our top choices. Read our IQ Option review to learn more about their CFD product, their new exchange and wallet Hodly, and what they are planning for the future.
  • Libertex is a Russian based CFD broker that currently has the largest selection of cryptocurrencies in the industry. With close to 20 digital assets, Libertex is a great and versatile option for any and all cryptocurrency traders.
  • eToro is a social trading platform with unique copy functions. The broker also has an impressive selection of cryptocurrencies, and they are currently developing their own cryptocurrency wallet and exchange that will become available globally within the next year.

Check out our list of the best CFD brokers to learn about even more options. 

Find the best trading platform. You capital is at risk when trading. Be careful.


Between 65-89% of retail CFD accounts lose money.