Investing in ICO? 3 Reasons to Think Again...

It has been said many times that ICO investment is high-risk. As an investor, we merely rely on the word of the project team that they will deliver what is written on the whitepaper. We send in our contributions, receive an equivalent project token in exchange, and carry on with the optimism that these tokens will rise in value. I have enjoyed some good gains from this myself.

However, like anything and everything, ICO also has two sides- the all sun-shiny wins and the gloomy losses. Today we have a peek at the later.

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The Not-So-Awesome Side of the ICO World

Sad as it may be, fact is there are people out there who would jump at any opportunity to scam people out of their crypto. Let me tell you of three instances that ICO investors can learn from.

1). The Vanishing Prodeum Project
Prodeum, a start-up company that was set to bring fruits and vegetables to the blockchain, has launched an ico with the goal of raising 5400 Ethereum, which is over $6M in current prices.
February 28, Sunday, prodeum.io site only had one word on the screen, and it wasn't an encouraging word for investors. Although some reports say they only were able to receive $11 contribution, it is a nice reminder to always DYOR ( Do Your Own Research) thoroughly when choosing ICO's to invest on.

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2). The Changing APEX Contribution Address
APEX is set to build an ecosystem that will decentralize the way Brand to Consumer interactions take place across the entire consumer lifecycle. The ICO took place January 29th and is one of the most anticipated ones this quarter with its telegram channel having over 18,000 members. It is built over the NEO platform and thus accepted only NEO tokens during the crowdsale. Prior to the ICO start, investors were instructed to login to their accounts in the apex site and send tokens only to the address that will be shown there.
I luckily have logged in to their site a few minutes prior the official crowdsale start. I would normally set-up the needful minutes before tokensale start, so I'd only need to click the "send" button once it starts. I had the NEO address AG4R1KnEi37XEonsH1mY77UGJyANVm1fKs to send to.
Others weren't so lucky. APEX site was hacked and the address was changed to
ALBH8s24bBAyuaNTKyjiuGB1vbgK95BCgT. Some investors sent in their funds in the hacker address.
APEX did good by honoring the NEO sent to the hacker address though and investors who sent their contribution to the wrong address still received their APEX tokens.

^{Image from APEX telegram chanel}

3). The Many Different "Official" Smart Contract Address on Every ICO
It has been a trend to have a telegram channel for ICO projects where the team would send in the announcements, and would answer potential investor's queries. The great things about this is that there is the easy access to someone from the project team. Another is seeing the community perception on the project, the enthusiasm or the lack of it. For popular ICO's, it would usually get crazy-busy during the crowdsale period.
Scammers take advantage of this situation by posting their wallet address on the official channel, by creating a fake channel of their own, or by impersonating admin teams and sending direct messages to people informing them of the "official" contribution address.
A fellow ICO investor unfortunately copied the wrong address on an ICO telegram channel and sent his funds to a scammer in error. (Worry not, he was able to recover his funds via trading of other coins.)

There are many more reasons to not get the expected returns in your ICO investment. The realization I had during the APEX crowdsale is, "If you can't brush off being scammed, then you're not built for the high-risk ICO world. Cliche as it sounds, really invest only what you can afford to lose."