Many Initial Coin Offerings (ICOs) have been and are frauds. The state enables this con game in various ways, including the establishment of accredited investors and the regulation of businesses that sell equity. Shut off from the most lucrative aspects of investment, average people rush into the few sources of profit still available to them. ICOs are a prime example of how state interference in the market increases the risks of doing business.

Also read: Don’t Blame China: Why BTC Still Can’t Compete With Fiat

Where There’s Money, There’s Fraud

Some degree of theft and fraud will always be present wherever there is money. The free market dramatically reduces those risks, however, as deregulation and securitization illustrate.

The golden days of ICOs are over, largely due to an understandable loss of public trust. This is a shame because ICOs serve a valid function. They raise funds by offering cryptocurrencies, called tokens, that are future claims on the profit of a startup project. Investors buy the bargain-priced tokens with…

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