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ICO and hacking: Two sides of the same cyber coin?
HomeNewsICO and hacking: Two sides of the same cyber coin?

ICO and hacking: Two sides of the same cyber coin?

News Desk
News Desk
January 31st, 2023
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It’s no wonder that more and more entrepreneurs turn to token sales, or ICOs financing, as they offer a quicker and more efficient financing solution.

According to Max Kordek, co-founder, and president of the Lisk Foundation, ICOs crowdfunding approach has enabled to .

This is not something you would see happening within the same period with traditional financing options, which makes it ideal for startups and tech entrepreneurs who need to be hitting the road promptly. It’s the ability to bypass the approval of VCs and other third parties that lets entrepreneurs use their ICOs to raise funds immediately, regardless of their location in the world and their financial status. Token sales open the door to a new type of investors who can easily and rapidly turn a startup dream into reality.

While this sounds promising, there’s one thing that Max Kordek has failed to mention. Summer 2017 has been punctuated by several scams of the cryptocurrency startup fundraisers. CoinDash, Parity bug and Enigma developer are some of the names that popped out in these ICOs scandals over the past few months. And as we’re talking millions of dollars, it’s worth asking why ICOs appear so simple to hack.  

New regulations for your safety

The majority of ICOs scams have been carried out through social frauds and manipulation, where cybercriminals masquerade as cryptocurrency administrators and share fake information. Enigma scam, for example, was the result of attackers using the company’s mailing lists to reach out to investors.

As a result, the Securities and Exchange Commission has been determined to bind ICO blockchains to regulated exchanges. The new regulations demand that some ICOs meet the standards of securities applied to non-crypto financing options.

To put things simply: When there’s monetary value, there’s a risk of fraud. It’s in your best interests to play by the SEC rules and maximize all the necessary data protection scenarios.

Yes, as a result, ICOs fundraising might not occur as smoothly as you hoped. But without time-demanding protections, ICO becomes the paradise of hackers.

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