Have you ever wondered why there are scam ICOs? Your guess is as good as mine. Fraud crowdfundings operate because there are a lot of people who would put their money in things they do not understand just because it is trending and they know or heard of someone that has made money through such ventures. Scam ICOs also thrive because there are others that do not conduct any form of research before transferring their digital currencies to strangers over the internet.
This is why a company has created an Initial Coin Offering called Super Cool Awesome Money (SCAM) to show that there are still people who will invest in a fraud no matter how obvious it is. The ICO ecosystem has been beleaguered with scam startups that have created concerns to crypto enthusiasts, the crypto community, and regulators. SCAM is a fake project with the intention of creating awareness on the possibility of investors getting scammed through fake or dubious ICOs.
SCAM obviously copied the ‘Useless Ethereum Token’ that clearly advertised itself as a rip-off but still got $300,000 worth of cryptocurrencies from investors showing there are people who will part with their money no matter how obvious a scam is. Both Useless Ethereum Token and Super Cool Awesome Money clearly advertised their ICOs as scams and as earlier mentioned, the former still managed to garner $300,000. It would be interesting to see the response to S.C.A.M. The concept is to show if people will start looking before leaping which we all know is not possible for everyone.
It gets interesting how these so-called transparent scam crowdfundings are shaping up. The Super Cool Awesome Money clearly stated on its website that the token has no value and should not be purchased. Yet there has been made a deposit of 0.01 ETH on the wallet. It is uncertain whether it was made by an investor or a team member in a bid to determine if the project wallet was properly integrated with the smart contract.
There is a moral question of the appropriateness of these transparent rip-off ICOs. It is still possible that with the success of Useless Ethereum Token there may be others who would want to pull off the same stunt. SCAM said on their website that they are offering 500 million tokens for sale, half of which shall be held by the company.
They highlighted that the token has absolutely no utility and that the investors will make no money. One starts wondering why such an offering will still attract any investments if not that some people will just read and not comprehend or simply invest because it seems there is money to be made.
One would be at a loss what happens after the ICO. Will there be any of the coins in circulation at all? If there would, will there be a serious price movement that may eventually make money for the wayward investor? Will the SCAM coin get listed in an exchange in the coin market? I doubt the later, but creating fraud awareness through Initial Coin Offering may be laudable.