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Comment by arkadiyt | Hacker News Reader

What is an ICO really - just a company minting tokens for people that they can exchange for something. They're not using any of the properties of blockchain, and no one is running nodes except for the company itself. They should just sell digital tokens via traditional ecommerce methods - nothing about ICOs depends on or takes advantage of being on a blockchain.

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Just an illegal securities offering.

We have laws for a reason.

> and no one is running nodes except for the company itself

What you're talking about doesn't seem to be an ICO but an IBO (Initial Blockchain Offering?). Most ICOs use a token on an already-established blockchain (e.g. ETH), so then there's no need to run a new network of nodes for it.

They're literally using the blockchain to distribute the tokens.

Wrong. They are using blockchain to generate hype. Internally it might as well be an Excel spreadsheet instead of blockchain and it wouldn't make a difference to the end user.

Again there are many different types of tokens that do many different things. One example, there are tokens that help secure the network (as in proof of stake) and in return you get fees (aka yield on your investment). This is just one example. There are many others, like lending out USDC (token pegged to USD) -- you can actually get 10% yield. You can also provide liquidity in liquidity pools and earn fees (again yield on your money at risk).

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