Unregulated crowdfunding is one of the major innovations introduced by Blockchain technology. This system of fundraising conquers the barriers of class and location, enabling anyone at anytime to participate in ventures they believe in without going through the rigorous processes of previous systems.
The two sides of ICOs
For innovators and product creators, the ability to raise funds through token sales and Initial Coin Offerings (ICOs) simplifies their fundraising processes and opens their markets to greater opportunities in the global community. These benefits are responsible for the popularity that ICOs have gained since 2016. We have seen huge crowdfunding campaigns conducted using an ICO, and dozens of companies are raising anywhere from $10 mln to $300 mln in a matter of minutes and days. The total amount raised by ICO’s grew from $200 mln in 2016 to $2 bln in 2017.
The inability of governments and other financial authorities to control or regulate these ICOs is seen as one of the major reasons why the powers-that-be are reluctant to accept ICOs as a legitimate model of capitalization. Not only that, but some insincere, dishonest or unqualified players have been involved in shady ICOs that have left members of the community and regulators worrying about the genuineness of this novel innovation…