Using blockchain technology, initial coin offerings have become an alternative means of acquiring funding for business projects using the new, evolving digital financial market for tokens. In contrast to initial public offerings, which are governed by strict legal regulations, ICOs require only a white paper and some interesting features, such as a lack of barrier to entry, a scope for exponential growth, absence of geographical barriers and easy validation.
Hence, it may not be surprising that the ICO market experienced extraordinary growth recently. Research shows that from January 2016 to August 2019, ICOs raised nearly $13 billion worldwide.
So what's the biggest ICO scam?
Klaus Grobys is a docent in financial economics at the University of Jyväskyla and an assistant professor of finance at the University of Vaasa. Grobys is also affiliated with the research platform InnoLab at the University of Vaasa. His recent studies investigate the opportunities and risks associated with new innovative digital financial markets. His recent research was, among others, covered by U.S. business magazine Forbes.