‘Wolf of Wall Street’ author Jordan Belfort joined the chorus of voices warning against the implications of ICOs. Thus, Wolf of Wall Street warns against ICO investments. while calling them the ‘biggest scam ever’.
24 October, AtoZForex – Initial coin offerings have gained massive popularity in the past months. But some has divisions in beliefs surrounding ICOs. Some assume ICOs are scam or fraud. Just like JP Morgan CEO asserted Bitcoin as fraud, the former stockbroker Belfort dismissed initial coin offerings as “the biggest scam ever”.
Wolf of Wall Street warns against ICO investments
According to online reports, Jordan Belfort, immortalized in the film The Wolf of Wall Street, has offered the following criticism of increasingly popular approach to fundraising.
“It is the biggest scam ever, such a huge gigantic scam that’s going to blow up in so many people’s faces. It’s far worse than anything I was ever doing,” says Belfort.
An ICO is a fundraising approach in which a company attracts investors looking for the next big cryptocurrency score by releasing a currency in exchange, typically, for Bitcoin.
In fact, it is said that Belfort was pleaded guilty to fraud and money laundering in 1999. But, nowadays he is promoting a book called “Way of the Wolf.” He thinks 85% of ICO promoters don’t have bad intentions, but 5% or 10% are “trying to scam investors.”
“They are using sales methods that resemble the “pump and dump” schemes, or a high-pressure selling outfits,” he added.
Jordan Belfort virtual currency criticism
This isn’t Belfort’s first turn as a crypto critic. Recently, he revealed there will be a viable virtual currency at some point, but it won’t be current No. 1 Bitcoin. Bitcoin jumped above $6,000 and traded in the vicinity of $6,150. But it recently was down modestly changing hands at $5,843, according to the market data.
Similarly, several companies and celebrities are advertising ICOs to create own cryptocurrency to rival Bitcoin. However, the get-rich-quick scheme offers the chance to buy a share of a company with the promise of great returns.
Yet, Belfort fears that ICOs could dupe first-time and small investors with promises of great returns. The author said the craze was similar to “bling pool” investments of the 1980s in which brokers made off with massive fees. Belfort’s view isn’t shared by the many startups who claim ICOs are a good point of access for small-time investors.
Every month there are offerings of 60 new coins. And, it is quite difficult for public to make the most of the fast moving crypto market. The limited number of credible research firms makes it even more difficult for investors to differentiate between products.
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