8 ICO Red Flags

One must be pedantic when investing in ICOs. While there are not that many pure scams, there are even more crappy ICOs that will never get their product done or hit crypto exchange. One should be careful not to give his money to such project. There are several indicators how to spot of fraudulent ICO or otherwise poor ICOs. 1. No Smart Contact. Yes. I have seen set ups that call themselves an ICO, but have no smart contract. They are either poorly made scams or just terrible business people and you should avoid them. Some ICOs claim to have smart contract, but are not willing to show it to the public. You should treat them as if they don’t have it. 2. Anonymous project. If you want to scam people, best way to do it is by hiding your identity. Therefore you should never trust a project that does not display it’s team members, company information nor physical address. No matter how good the project seems, there is a reason why they are hiding their identity. 3. Zero in raised funds. No raised funds is the clearest sign that ICO is not going to make it. Don’t be the first (and only) idiot to invest in a bad ICO. Some ICOs try to hide it by displaying false information on their website, therefore always check Etherscan, or ask for proof of investments. 4. No public discussion channel. Be suspicious if there is no place discuss openly about the project. Sadly many ICOs have switched from Telegram group into Telegram channel. If an ICO uses one-way communication platforms it usually means that they don’t want other people to see negative feedback that they receive. 5. Raising too much money. Honest ICOs will ask for the amount of money they actually need to develop their product. Usually it’s between $5M and $20M. But there are some ICOs that have their hard cap set at $100M or even higher. These ICOs obviously just want to raise as much money as possible, and it makes you wonder: Where will that money go? 6. Too complicated or incoherent plan. While it does not always mean that ICO is bad (maybe you just didn’t understand it), usually it’s a sign that team is not professional enough or that they are just forcing blockchain in their business, when in reality it does not fit there. 7. Team members have no social media profiles. If no one, or only one member of the team has linked his social media profile it makes you wonder are those people real. 8. Homogenous team. While this is not always a red flag, I’m usually skeptical if all team members are of the same decent (e.g. Chinese or Russian). While I understand that teams usually live in the same place and therefore have same nationality, they should at least hire advisors that are from different country.