China has come out strongly against Initial Coin Offerings and while there are many theories around why, I have to ask, "Is it a bad thing?" I mean let's face it, there are many 'pump and dump' alt coins out there. Those that are made solely to be sold through an ICO, then for the developers to take the money raised and run.
If cryptocurrencies are to take their rightful place in the world they need to be trusted. Not only by the people who use them but by governments too. One of the problems with ICOs is that just like stocks and bonds, they're a gamble. The phrase "Caveat Emptor" is perhaps more relevant to ICOs than almost anything else.
The alt coin space is unregulated and, is a very good way (at this moment in time) to raise money and then just disappear. China is worried about the risk to its people and worried it will upset the social order. Of course as a disruptive technology alt coins and blockchain are designed to upset the social order.
China bans ICOs
Sometimes though, the social order they disrupt fights back.
If this ban from China and the doubts arising in Singapore forces token developers to actually provide a true alt coin with a clearly designed use, that would be a good thing.
If I'm going to invest in a new coin/token I want to know exactly what they have planned. I want to see a clear use case for the coin. Something that's going to be useful to me and others, something that has clear benefits that I can find no where else. I want to see clear and transparent communications between the dev team and investors/potential investors. I want to be able to ask relevant questions and get actual answers, not 'political' ones. You know, like when you ask a politician and get an answer that's not an answer but which sounds good, until that is you think it through.
I want to know that there's a way for me to petition for specific things to be included in the technology. A clear plan to promote and market the coin is also good.
In fact, there are so many things I want to see, that I end up investing in very few. As an example, On Social is a social sharing website/platform that shares ad revenue with its contributors. It works very similar to Facebook but without the manipulations that can be used by the algorithm.
In other words, if I use On Social just like I do Facebook, I get paid. It's not the same as Steemit though it is similar. It allows updates and articles as well as images and links. I can also share my posts with Facebook, LinkedIn etc. Will all Facebook users move over? No, it's not trying to do that (but who knows what the future will bring), but it does offer a clear benefit to me over Facebook. I do what I do AND get paid.
There are more of course, like Golem a token based way to get access to a 'super computer', you 'rent' unused computing power. Again, this one has a clear purpose aside form just being a coin. Built on the Ethereum blockchain both of these look good, would I recommend them? Not really because I think anyone investing should do their own research.
I use On Social and allow my spare computing power to be used on the Golem network, but you must do your own research and make up your own mind.
Back to China and its ban on ICOs, this could be a good thing, it could help curb the scams and ripoff merchants. if that happens then we could see a surge in useful blockchain based tokens and platforms and that, in my opinion would be a good thing!
For those who want to know How Crypto Tokens Work take a look at this Forbes article.
