ICO Scam Built on the Ethereum Blockchain
We have seen quite a few ICO projects designed to make fun of the entire business model. People will gladly throw money at any initial coin offering without doing the scantiest research. This is why projects such as Super Cool Awesome Money – or SCAM – exist. It is apparently a scam and advertises itself as such, yet people will undoubtedly buy into this ICO. This shows us just how little research some people do when it comes to cryptocurrency.
We can easily argue about how the vast majority of current cryptocurrency ICOs are either scams or far too ambitious for their good. That doesn’t mean no ICOs will succeed, but it is evident things will come to a head sooner than later. So far, we have seen the SEC crackdown on potential scams and projects which do not follow any of its securities guidelines. After all, issuing securities without filing with the SEC is a clear indication that a project has less than honest intentions.
Thankfully, there are some initial coin offerings which can only be described as brutally honest. The Super Cool Awesome Money project, for example, claims it will create another useless ERC20 token which brings nothing to the table. However, the team does not guarantee said token will increase in value, nor are they looking to raise any money. Rather, it is designed to show the world that investors should do proper research first and foremost.
The initials of this project spell SCAM, which is what this project is all about. It is an honest-to-goodness scam, similar to the Useless Ethereum Token we covered a few months ago. The latter project ultimately raised over US$300,000 because people simply forgot to read the big letters on the website. The new SCAM token does absolutely nothing, it has no intrinsic value, and it shouldn’t be purchased. However, it will only take a few novice cryptocurrency investors to turn this project into a major success.
So far, only one contribution has been made for the amount of 0.01 Ether. This was probably a team member looking to test whether the smart contract had been set up properly. Over the next three weeks, we may see additional transactions trickle in. After all, we have seen a lot of strange things happen in the ICO industry throughout 2017 and early 2018, and it seems plausible that the SCAM ICO will eventually attract some wayward investors.
On their website, the team clearly lays out their true plan for this token. As one would expect, it contains absolutely nothing which grants any value to this token. SCAM has all of the marvelous features one would expect in most ICO tokens, including the ERC20 token standard, fast transactions – assuming the Ethereum network isn’t congested – and infrequent airdrops to random coin holders. With 500 million tokens to be sold and the same amount being held by the team, there is no reason not to expect a major dump if any exchange were to ever list this token.
It is evident that projects like these are direly needed to teach the average cryptocurrency enthusiast a thing or two about initial coin offerings. There is certainly an opportunity to make money with the SCAM token, although no one should buy it simply based on that expectation. After all, that is not what this project is all about, and it is more than likely we will see a very small number of these tokens in circulation in the future. Then again, cryptocurrency remains a very unpredictable industry.