Brad Garlinghouse, the CEO of cryptocurrency Ripple, traded as XRP, knows initial coin offerings inside and out. As the lead executive of one of planet Earth’s most prominent cryptocurrencies, Garlinghosue definitely has credibility.
With initial coin offerings reaching hundreds of millions of dollars, one would think the coin companies offering these ICOs are skating off with the most money, right? Wrong, at least according to Mr. Garlinghouse.
The CEO of Ripple suggests that lawyers are the “biggest winners” of initial coin offerings. Not only do they contribute services and advice that’s material – they also earn quite a bit of money from their services.
What Is An ICO?
Just like when a private company goes public and offers stock shares for sale – initial public offerings, or IPOs – cryptocurrencies, or digital currencies, offer their currency for sale, too – initial coin offerings, or ICOs.
ICOs collectively make up a big market, too. All considered, cryptocurrency firms raised roughly $3.8 billion just through IPOs in 2017. That number is slated to increase in 2018.
Cryptocurrency markets aren’t yet protected by government regulations, however, so truly rapid, worldwide growth probably won’t come until such frameworks are in place to protect consumers.
Garlinghouse also said that “most of the ICOs you’re seeing are not real token use cases. They’re really securities.” In general, people don’t, in fact, understand the difference between coins, utility tokens, and securities.
Not just investors, but everybody should read about them to guard against misrepresentation and misunderstanding.