Initial Coin Offerings (ICO) “failed” to provide protection against insider trading or stick to their whitepaper promises, a new report from the University of Pennsylvania Law School released July 17 reveals.
The lengthy study of the ICO phenomenon, dubbed “Coin-Operated Capitalism,” begins with a frank appraisal of investor expectations versus reality, the four contributing professors finding basic inconsistencies in the behavior of a “significant” number of projects.
In the introductory comments, they state that their “inquiry reveals that many ICOs failed even to promise that they would protect investors against insider self-dealing.
In their paper, the UPenn law professors use Estonian financial institution Polybius as an example of promises made in the whitepaper against real progress post-token sale.
In May, Binance CEO Changpeng Zhao determined that “raising money through ICOs is about 100 times easier than through traditional VCs, if not more.”
Digital assets are a relatively new asset class that made smart money investors fall in love with high gains during the 2021 bull market. Traditional finance institutions like venture capital firms then poured billions onto the crypto market, boosting development of certain protocols and projects.
BitMEX founder Arthur Hayes has recently been in the news as a high profile antagonist of ether, going as far as describing it as a “two-digit shitcoin. ” Some have accused him of using his platform to encourage users to short the number two cryptocurrency.
Its publication diversifies the broad EU standpoint on the technology, which continues to include legal projects to monitor residents’ usage and clamp down on anonymity. However, they remain unlikely to challenge the dominant position of sovereign currencies and central banks, especially those in major currency areas. In addition to staking its belief in their longevity,
