Nice thread you created. What can you say of involving the blockchain in e-sports community. Does it have potential?
I think there are already projects that do that platform, blockchain esport community, and i think it's quite good for players or gamers and still business minded, they will be able to earn in it. 
Topic: 3 kinds of ICOs — Protect yourself - page 17. (Read 13704 times)
Nice thread you created. What can you say of involving the blockchain in e-sports community. Does it have potential?
One of the best things that I found on the bitcointalk. Thank you for all the information that you added here. It is very helpful.
I think that nowadays it is hard to find a good ICO. Too many scams out there. Therefore I don't invest in ICOs. Until now I didn't found something worth my time and money.
But I suppose that if you find a good ICO, it could be a good thing to invest. It requires a lot of reading and researching.
I think that nowadays it is hard to find a good ICO. Too many scams out there. Therefore I don't invest in ICOs. Until now I didn't found something worth my time and money.
But I suppose that if you find a good ICO, it could be a good thing to invest. It requires a lot of reading and researching.
One way to reduce the amount of reading is to use filters. Use the filters that I suggested, or come up with your own. They should quickly filter out most of the ICOs.
Then, there should be only a handful of ICOs that pass your filters. With these, you can read their website more in depth or their white paper.
After reading tons of whitepapers of crap icos, I found this thread to be so informative and useful. 90% of current ICO projects are either non-sense or simply scams, 9% could be startups that could have failed first round in real world presentations for investors, probably 1% or less is the blockchain app that really makes sense and their coin value could be more than 0...
Great post - well written... One thing to add is that even legitimate ICOs have a chance of not making it do to a multitude of factors just how it is for startups that choose traditional funding. Investing is evaluating risk and reward and there are underlying risks even with legitimate ICOs.
Great job man. Your attitudes are nicely logic. I can't count the number of useless services given by un-known persons that focuses all their attention to the token and the ICO when they should be spending time making prototypes/products. Would you kindly share your opinions about start-ups on the prediction market using hybrid intelligence into blockchain, i recently saw two projects starting with ICO; Cindicator and Trackr. Also the two famous ICO working on freelance market; Bitjob (freelance for students.ICO just finished) Blocklancer (platform for freelance jobs.ICO sheduled to winter 17/18).
Thanks in advance
Thanks in advance
you can also add:
how devs answers to technical questions and criticism?
how many percents of total tokens will devs hold?
how devs answers to technical questions and criticism?
how many percents of total tokens will devs hold?
saddyl that there are to much scam -.-
Hi Henry,
If funders can guide the company, then most companies would be soliciting their shareholders for input, because this is much cheaper than paying market research companies. But companies don’t do this for good reason.
The most difficult part for startups is getting HONEST answers. The last people that they should solicit input from, are their friends and family. These people will NOT tell the truth, because they do not want to hurt the founder’s feelings or discourage the founder.
If funders can guide the company, then most companies would be soliciting their shareholders for input, because this is much cheaper than paying market research companies. But companies don’t do this for good reason.
The most difficult part for startups is getting HONEST answers. The last people that they should solicit input from, are their friends and family. These people will NOT tell the truth, because they do not want to hurt the founder’s feelings or discourage the founder.
You're absolutely right about needing honest answers - but as I said, we don't aim to invalidate good market research. Some things really do need answering with specific methods, and we don't expect to offer a silver bullet solution to companies.
The most important answer that all startups should seek, but they rarely do, is: “Your startup SUCKS and will FAIL”. It is actually very difficult to get this input because most people do not want to offend the founder. But this answer is critical. If is much better that the startup gets this answer, so they can pivot or cancel their startup to save a ton of time and money for everyone.
What happens quite often is that startups will ask people, including acquaintances, what do they think of their product? Instead of getting “it STINKS and will FAIL”, they’ll get “well…if this was changed this way…it might have potential…I may not use it, but maybe other people will use it…”. They do this because they want to be nice or courteous to the founder. So, the startup continues working on it when they should be abandoning it.
The only people who will tell the TRUTH are potential customers who are told to part with their money. They will say “There’s no way I’m paying $5 for that!”
What happens quite often is that startups will ask people, including acquaintances, what do they think of their product? Instead of getting “it STINKS and will FAIL”, they’ll get “well…if this was changed this way…it might have potential…I may not use it, but maybe other people will use it…”. They do this because they want to be nice or courteous to the founder. So, the startup continues working on it when they should be abandoning it.
The only people who will tell the TRUTH are potential customers who are told to part with their money. They will say “There’s no way I’m paying $5 for that!”
You don't feel that facilitating investment in companies is undertaking exactly what you are describing? We do expect people to consider parting with their money, and therefore very critically assessing companies. It doesn't mean every user will approach discussions this way, but it will ensure that there's not simply an echo chamber.
Not only do you need to ask potential customers, you need to get answers from total strangers who are not answering questions to you.
Let’s say you are standing on the street asking strangers this question: “I’m thinking of selling Japanese seaweed snacks. Will you buy some?” Some strangers will not want to offend you. They will be nice and courteous and say “Hmmm, I don’t know. Thanks anyway.” or “Maybe, but I’m in a rush.” or “Wow, that’s new. Never heard of it. I don’t know if I would buy them, but I’ll keep an eye out for it the next time I’m at the store.”
What you want is the truth. You want them to say: “No, I would never buy that.” That’s why companies hire market research companies to ask strangers: “Company ABC is thinking of selling Japanese seaweed snacks. Would you buy any?” This takes the pressure off the strangers and lets them be more honest.
The other problem with asking friends, family and acquaintances is that most people try to answer even when their answer should be: “I don’t know”. With some people I know, they will never answer “I don’t know”. They’ll guess at the answer. I don’t want guesses. I want to hear “I don’t know” if they don’t know.
Let’s say you are standing on the street asking strangers this question: “I’m thinking of selling Japanese seaweed snacks. Will you buy some?” Some strangers will not want to offend you. They will be nice and courteous and say “Hmmm, I don’t know. Thanks anyway.” or “Maybe, but I’m in a rush.” or “Wow, that’s new. Never heard of it. I don’t know if I would buy them, but I’ll keep an eye out for it the next time I’m at the store.”
What you want is the truth. You want them to say: “No, I would never buy that.” That’s why companies hire market research companies to ask strangers: “Company ABC is thinking of selling Japanese seaweed snacks. Would you buy any?” This takes the pressure off the strangers and lets them be more honest.
The other problem with asking friends, family and acquaintances is that most people try to answer even when their answer should be: “I don’t know”. With some people I know, they will never answer “I don’t know”. They’ll guess at the answer. I don’t want guesses. I want to hear “I don’t know” if they don’t know.
No need to try and convince me further that market research is still of value, I agree. I believe it's mutually compatible with what we are doing.
If your startups ask your YUPIE token holders for input, there is the real danger that your token holders will do one of the following:
- Not tell the truth in fear of hurting anyone’s feelings
- Compelled to give input when he has no answer to the question, which is really garbage input. If your startup asks “How much would you pay for Japanese seaweed snacks?” Most of your token holders should say “I don’t know”. But I guarantee you that a significant percentage will make up an answer.
Token holders must not be confused with people who actually have a stake in a company - those with a stake in a company will certainly want it to succeed, which I'm sure many people can figure out (just as you so clearly point out) means not simply agreeing with everything.
You have some great points, and I assure you we are carefully considering exactly what you bring up. It's something we will have to adapt to as we move on. I don't think you have found a major flaw in our concept, though. Truthful answers are great, and companies need them, but they are not the only thing of value to be had from a relationship between business and public.
One of the best things that I found on the bitcointalk. Thank you for all the information that you added here. It is very helpful.
I think that nowadays it is hard to find a good ICO. Too many scams out there. Therefore I don't invest in ICOs. Until now I didn't found something worth my time and money.
But I suppose that if you find a good ICO, it could be a good thing to invest. It requires a lot of reading and researching.
I think that nowadays it is hard to find a good ICO. Too many scams out there. Therefore I don't invest in ICOs. Until now I didn't found something worth my time and money.
But I suppose that if you find a good ICO, it could be a good thing to invest. It requires a lot of reading and researching.
Do your own homework - read reviews.
I haven't looked at most of the coins on your list, but I have looked at a few and I think those have significant flaws which I wrote about in this thread:
ARToken
LAToken (inference from write up of Swarm)
Change Bank (and Bankera)
TokenStars
Hi Henry,
If funders can guide the company, then most companies would be soliciting their shareholders for input, because this is much cheaper than paying market research companies. But companies don’t do this for good reason.
The most difficult part for startups is getting HONEST answers. The last people that they should solicit input from, are their friends and family. These people will NOT tell the truth, because they do not want to hurt the founder’s feelings or discourage the founder.
The most important answer that all startups should seek, but they rarely do, is: “Your startup SUCKS and will FAIL”. It is actually very difficult to get this input because most people do not want to offend the founder. But this answer is critical. If is much better that the startup gets this answer, so they can pivot or cancel their startup to save a ton of time and money for everyone.
What happens quite often is that startups will ask people, including acquaintances, what do they think of their product? Instead of getting “it STINKS and will FAIL”, they’ll get “well…if this was changed this way…it might have potential…I may not use it, but maybe other people will use it…”. They do this because they want to be nice or courteous to the founder. So, the startup continues working on it when they should be abandoning it.
The only people who will tell the TRUTH are potential customers who are told to part with their money. They will say “There’s no way I’m paying $5 for that!”
Not only do you need to ask potential customers, you need to get answers from total strangers who are not answering questions to you.
Let’s say you are standing on the street asking strangers this question: “I’m thinking of selling Japanese seaweed snacks. Will you buy some?” Some strangers will not want to offend you. They will be nice and courteous and say “Hmmm, I don’t know. Thanks anyway.” or “Maybe, but I’m in a rush.” or “Wow, that’s new. Never heard of it. I don’t know if I would buy them, but I’ll keep an eye out for it the next time I’m at the store.”
What you want is the truth. You want them to say: “No, I would never buy that.” That’s why companies hire market research companies to ask strangers: “Company ABC is thinking of selling Japanese seaweed snacks. Would you buy any?” This takes the pressure off the strangers and lets them be more honest.
The other problem with asking friends, family and acquaintances is that most people try to answer even when their answer should be: “I don’t know”. With some people I know, they will never answer “I don’t know”. They’ll guess at the answer. I don’t want guesses. I want to hear “I don’t know” if they don’t know.
If your startups ask your YUPIE token holders for input, there is the real danger that your token holders will do one of the following:
If funders can guide the company, then most companies would be soliciting their shareholders for input, because this is much cheaper than paying market research companies. But companies don’t do this for good reason.
The most difficult part for startups is getting HONEST answers. The last people that they should solicit input from, are their friends and family. These people will NOT tell the truth, because they do not want to hurt the founder’s feelings or discourage the founder.
The most important answer that all startups should seek, but they rarely do, is: “Your startup SUCKS and will FAIL”. It is actually very difficult to get this input because most people do not want to offend the founder. But this answer is critical. If is much better that the startup gets this answer, so they can pivot or cancel their startup to save a ton of time and money for everyone.
What happens quite often is that startups will ask people, including acquaintances, what do they think of their product? Instead of getting “it STINKS and will FAIL”, they’ll get “well…if this was changed this way…it might have potential…I may not use it, but maybe other people will use it…”. They do this because they want to be nice or courteous to the founder. So, the startup continues working on it when they should be abandoning it.
The only people who will tell the TRUTH are potential customers who are told to part with their money. They will say “There’s no way I’m paying $5 for that!”
Not only do you need to ask potential customers, you need to get answers from total strangers who are not answering questions to you.
Let’s say you are standing on the street asking strangers this question: “I’m thinking of selling Japanese seaweed snacks. Will you buy some?” Some strangers will not want to offend you. They will be nice and courteous and say “Hmmm, I don’t know. Thanks anyway.” or “Maybe, but I’m in a rush.” or “Wow, that’s new. Never heard of it. I don’t know if I would buy them, but I’ll keep an eye out for it the next time I’m at the store.”
What you want is the truth. You want them to say: “No, I would never buy that.” That’s why companies hire market research companies to ask strangers: “Company ABC is thinking of selling Japanese seaweed snacks. Would you buy any?” This takes the pressure off the strangers and lets them be more honest.
The other problem with asking friends, family and acquaintances is that most people try to answer even when their answer should be: “I don’t know”. With some people I know, they will never answer “I don’t know”. They’ll guess at the answer. I don’t want guesses. I want to hear “I don’t know” if they don’t know.
If your startups ask your YUPIE token holders for input, there is the real danger that your token holders will do one of the following:
- Not tell the truth in fear of hurting anyone’s feelings
- Compelled to give input when he has no answer to the question, which is really garbage input. If your startup asks “How much would you pay for Japanese seaweed snacks?” Most of your token holders should say “I don’t know”. But I guarantee you that a significant percentage will make up an answer.
Do your own homework - read reviews.
If you can't deliver something that the common people understand, don't even bother.
Well, it's absolutely true that you shouldn't invest in something you don't understand, but it's also important to consider that not every ICO is intended for everyone to invest in! Arguably the more honest ones are actually not targeting everyone, but rather focusing on those who do understand what they're getting involved with.
Likewise, the end users of a product may not need to understand the fundamentals of how that product actually functions. So there can be some contrast between materials which explain what a product is, and materials which explain what a product is for the purpose of getting investments.
Take some of the most successful ICOs for instance: Filecoin, Ethereum, etc. They don't strain themselves to make everything super-simple so everyone can understand. Check out their whitepaper for example. They do also provide a very simple and effective explanation of what their product is for the general public, though. These are two very different sets of material for different purposes.
"This is a quote from Warren Buffett. It is very applicable because many ICO teams try to impress the audience with technical jargon. Many investors are not tech savvy and are baffled or confused, but they invest because they think that the project team must have come up with a technological break-through."
I couldn't agree more. If you can't deliver something that the common people understand, don't even bother.
I couldn't agree more. If you can't deliver something that the common people understand, don't even bother.
Hi jlp, I'm one of the Crowdholding team. Thanks for voicing your concerns, I'll see what I can do to address each of the points you made.
Our beta app is https://crowdholding.com. We ran an alpha since October 2016, and beta has been going since March 2017. We've been trying a lot of cool stuff with it, but it's absolutely open to further change and improvement. We are working on making it a smooth PWA (progressive web app), but it's more desktop friendly at the moment.
I don't believe this is a good comparison. The idea of the website is that absolutely anyone in the world can join the community - it's not a walled garden for YUPIE token holders. It's as we describe it - an open innovation platform.
Well, we certainly aim to encompass end users and customers in the community! Personally I have a lot of respect for market research, and I don't think our app is going to suddenly render it useless, but I do believe we also have great value in what we are undertaking.
You're right, some questions aren't necessarily appropriate, and probably wouldn't yield valuable results. A more appropriate question might be "Here's a couple of designs we're planning to use for the packaging of our new 'Japanese Seaweed Snacks'. Do you like 'A' or 'B'? Why?" Of course, this is a really basic survey question, and surveys are nothing new. However, the nature of putting the question to people has a lot of space for improvement.
Also consider that the value is not always in the result, but in the discussion itself. Probably one of my favourite examples of businesses connecting with a crowd is the 'Do us a flavour' campaigns (https://en.wikipedia.org/wiki/Lay%27s#Do_Us_a_Flavour_contests). Crowdholding is all about this connection between businesses and the public, which I have good reason to believe has enormous space for improvement.
Being able to actually discuss topics with a company can not only be a good chance to impact change for the better, but it can actually be fun too. Again, this absolutely has more potential for some types of business over others. Consider the gaming industry for example, there's plenty of places to discuss games online, but we feel we can facilitate that exchange in a much more meaningful way for both parties.
You're absolutely right - we don't use the tokens to enforce contracts. We use separate contracts! During our beta we have been experimenting with the concept of 'crowdshares'. Basically this would involve a contract between the startup and the company committing a share of revenue, with specified parameters. The tokens are there to function as a currency, which simply put, is a great use of a token. For now we want explanations as simple as possible, because just like the traditional system of shares and currencies, it can get enormously complicated! If you think including this discussion in our core materials is needed though, we're really happy for the feedback. Personally I'd like to keep it to other documentation, FAQs, etc. Ultimately we need to improve on this, but we're still a fairly small team and are desperately trying to prioritise.
A crucial point to note is that we are not suggesting profit sharing, but revenue sharing. And how long you wait before Crowdholding's startups start rewarding you is a really good question. Currently we are setting a threshold for a company to pass a certain annual revenue before any is shared to the public. However, we are absolutely open to changing this model if we have good reason to. The idea of a fixed sum bounty can be a much simpler alternative, for example.
Also, consider that while you can invest in companies using YUPIES, we don't believe this is suitable for everyone, or even most people. The typical case for most users will simply be as an active community member, meaning you would have the potential to receive YUPIES, which (if you want to cash out) can be exchanged for other cryptocurrencies, or used in the Crowdholding economy - investing in companies, or purchasing products directly.
There's definitely a lot of challenges here, but also enormous opportunity. If it was easy then someone probably would have done it ages ago! We don't want to ride off jargon - but you're absolutely right that our language can be improved. If there's any specific ways we phrase things which stand out, I'd honestly appreciate feedback on them.
Hope this clears some points up!
Cheers,
Henry
Crowdholding claims that they have a working beta, which is good news. However, I can’t find it on their website. Have you used it? Have lots of people used it to help guide a startup to success?
Our beta app is https://crowdholding.com. We ran an alpha since October 2016, and beta has been going since March 2017. We've been trying a lot of cool stuff with it, but it's absolutely open to further change and improvement. We are working on making it a smooth PWA (progressive web app), but it's more desktop friendly at the moment.
Their white paper says that the problem is that too many startups fail due to lack of market need. Their solution is that funders (YUPIE token holders) will be able to tell the startups how to find market needs.
This is ridiculous. If this is the case, then companies would be asking their shareholders on what the market needs. Google, Apple, Facebook and the hundreds of thousands of companies should be asking their shareholders about market needs. They don’t. Why not? Because the shareholders do not know.
This is ridiculous. If this is the case, then companies would be asking their shareholders on what the market needs. Google, Apple, Facebook and the hundreds of thousands of companies should be asking their shareholders about market needs. They don’t. Why not? Because the shareholders do not know.
I don't believe this is a good comparison. The idea of the website is that absolutely anyone in the world can join the community - it's not a walled garden for YUPIE token holders. It's as we describe it - an open innovation platform.
The only people who will know are the end-users and customers. That’s why companies spend billions on market research, focus groups, free samples, surveys, product trials, etc., etc. The only people who know and will tell the truth are those who have to part with their money and will get enough value in return to justify it. Anyone who has studied Marketing knows this.
Well, we certainly aim to encompass end users and customers in the community! Personally I have a lot of respect for market research, and I don't think our app is going to suddenly render it useless, but I do believe we also have great value in what we are undertaking.
Let’s say that there is a startup that wants to sell Japanese seaweed snacks. How much are you willing to pay for the snacks? What would you recommend to the startup? Even if you wouldn’t eat this, how would you know others won’t? You may never have tasted it before, so you will have no idea. The only way the startup will know if these snacks will sell is if they do market research, in the right target markets, with product trials, etc.
You're right, some questions aren't necessarily appropriate, and probably wouldn't yield valuable results. A more appropriate question might be "Here's a couple of designs we're planning to use for the packaging of our new 'Japanese Seaweed Snacks'. Do you like 'A' or 'B'? Why?" Of course, this is a really basic survey question, and surveys are nothing new. However, the nature of putting the question to people has a lot of space for improvement.
Also consider that the value is not always in the result, but in the discussion itself. Probably one of my favourite examples of businesses connecting with a crowd is the 'Do us a flavour' campaigns (https://en.wikipedia.org/wiki/Lay%27s#Do_Us_a_Flavour_contests). Crowdholding is all about this connection between businesses and the public, which I have good reason to believe has enormous space for improvement.
Being able to actually discuss topics with a company can not only be a good chance to impact change for the better, but it can actually be fun too. Again, this absolutely has more potential for some types of business over others. Consider the gaming industry for example, there's plenty of places to discuss games online, but we feel we can facilitate that exchange in a much more meaningful way for both parties.
Even if Crowdholding's idea has merit, how do you, as a YUPIE token holder, know for sure that startup companies will reward you after they succeed? The tokens are not legal contracts. You cannot get a judge to force the company to pay.
You're absolutely right - we don't use the tokens to enforce contracts. We use separate contracts! During our beta we have been experimenting with the concept of 'crowdshares'. Basically this would involve a contract between the startup and the company committing a share of revenue, with specified parameters. The tokens are there to function as a currency, which simply put, is a great use of a token. For now we want explanations as simple as possible, because just like the traditional system of shares and currencies, it can get enormously complicated! If you think including this discussion in our core materials is needed though, we're really happy for the feedback. Personally I'd like to keep it to other documentation, FAQs, etc. Ultimately we need to improve on this, but we're still a fairly small team and are desperately trying to prioritise.
Startups take many years before they are financially successful. Most companies are still losing money when they go IPO on the stock market. Amazon is barely making any profits. Twitter is still losing money. Facebook took way longer than most companies to IPO and they barely showed a profit. Technology and growing companies rarely pay dividends. How long will you wait before Crowdholding’s startups start rewarding you?
A crucial point to note is that we are not suggesting profit sharing, but revenue sharing. And how long you wait before Crowdholding's startups start rewarding you is a really good question. Currently we are setting a threshold for a company to pass a certain annual revenue before any is shared to the public. However, we are absolutely open to changing this model if we have good reason to. The idea of a fixed sum bounty can be a much simpler alternative, for example.
Also, consider that while you can invest in companies using YUPIES, we don't believe this is suitable for everyone, or even most people. The typical case for most users will simply be as an active community member, meaning you would have the potential to receive YUPIES, which (if you want to cash out) can be exchanged for other cryptocurrencies, or used in the Crowdholding economy - investing in companies, or purchasing products directly.
I do not think Crowdholding is trying to scam anyone. They likely think that they have a good idea, but do not see the flaws. Most ICO buyers do not see these flaws because they haven’t spent enough time in the business world and are impressed by lots of jargon and big teams with fancy titles.
There's definitely a lot of challenges here, but also enormous opportunity. If it was easy then someone probably would have done it ages ago! We don't want to ride off jargon - but you're absolutely right that our language can be improved. If there's any specific ways we phrase things which stand out, I'd honestly appreciate feedback on them.
Hope this clears some points up!
Cheers,
Henry
"SEC Committee Lashes Out at Bitcoin and ICOs"
https://www.coindesk.com/obvious-bubble-sec-committee-lashes-bitcoin-icos/
There are legitimate ICOs that make sense and that the blockchain can help. You just have to do more work to filter out the scams and crap to find them.
https://www.coindesk.com/obvious-bubble-sec-committee-lashes-bitcoin-icos/
Quote
"My sense is that most of the conversation that goes on around this is essentially designed to obscure. [It] uses big ideas and technical jargon to evade fundamental questions that should be asked in this institution about any investment product."
Quote
"...growing incidences of fraud."
There are legitimate ICOs that make sense and that the blockchain can help. You just have to do more work to filter out the scams and crap to find them.
Thank you for this post!
Thanks jlp for this post. Really helped me rethink my investment strategy with a much better understanding of what to look for in a successful coin.
Much appreciate.
Much appreciate.
Rega Crowdsurance is trying to mislead you. Their website state:
Currently, few cars and homes are shared. Cars and bikes are parked and unused 90% of the time. Therefore, there is an opportunity to increase utilization by sharing them. This is not applicable to insurance. Risks are already shared with insurance companies. There is no such thing as a risk sitting on your driveway, waiting to be used. When you buy insurance from anyone, you are automatically sharing the risk.
The way to reduce the money you pay, is to increase competition. There are already tens of thousands of insurance companies and there are bankruptcies (insolvencies) every year. Google it. They go bankrupt because they are NOT charging the customers enough to cover the risks that the insurer is taking on. This implies that customers can be paying too little already.
A crypto currency speeds up and lowers cost for bank wire transfers. A crypto currency eliminates the high cost and multi-day withdrawal from gambling sites. The key to success in insurance is not related to the currency. A new currency does NOTHING for the insured nor does it improve an insurer’s operating costs or COMBINED RATIO, which is one factor to profitability.
Their white paper states:
Does Rega Crowdsurance think that their 20 years experience in risk assessment is superior to Berkshire Hathaway’s 60 years experience in risk assessment? Even though AIG has 100 years of experience in risk assessment, they almost went bankrupt.
What makes Rega Crowdsurance think they know more than anyone else in how much to charge you to insure your car against the next accident?
Even if Rega Crowdsurance thinks they know risk assessment, there is another major factor to profitability: KNOWING HOW TO INVEST. Let’s say you are an insurer and you collect $100 million of premiums, which is called the PREMIUM POOL. You won’t have any claims until the next hurricane. What you do with the premium pool is critical. You cannot let it sit there to collect dust. You have to invest it. Where and how are you going to invest it? Quite often, insurance companies lose money from underwriting (risk assessment) and make up the loss from their investments. The majority of profits for Berkshire Hathaway comes from how the premium pool is invested. What makes you think Rega Crowdsurance knows how to invest?
Their white paper states:
Yes, there are insurers: other users. GEICO has had no intermediaries nor brokers for 70 years. Other insurance companies exist without brokers.
If you are a Rega Crowdsurance user, you will be an insurer or insured. If you are an insurer, are you going to go through the hassle of complying with the multitude of state government regulations on insurers?
If you are an insured, is the state government going to make sure that Rega Crowdsurance is properly capitalized so that they will have enough to fully reimburse you and all of the insured when your cars are destroyed?
Their white paper addresses regulations by stating this:
Most of this is verbose. The rest is misleading. Regulations of insurance is not related to illegal activities or money laundering. They are there to make sure that the insurer has enough money to pay all of the claims.
Rega Crowdsurance is extremely is extremely high risk, unless it is being started by former executives of GEICO, State Farm, etc.
Also, they are in a country without extradition agreements. If they screw you over, they are immune from punishment from your government. This makes them more invulnerable and likely to make any claim they want.
Quote
“We all heard about shared economy: people sharing cars, home, bikes, even wi-fi. But why can’t we share our risks and protect each other without insurance companies. We have to pay lots of money because only insurance companies have algorithms for risk assessment, technology and resources.”
Currently, few cars and homes are shared. Cars and bikes are parked and unused 90% of the time. Therefore, there is an opportunity to increase utilization by sharing them. This is not applicable to insurance. Risks are already shared with insurance companies. There is no such thing as a risk sitting on your driveway, waiting to be used. When you buy insurance from anyone, you are automatically sharing the risk.
The way to reduce the money you pay, is to increase competition. There are already tens of thousands of insurance companies and there are bankruptcies (insolvencies) every year. Google it. They go bankrupt because they are NOT charging the customers enough to cover the risks that the insurer is taking on. This implies that customers can be paying too little already.
A crypto currency speeds up and lowers cost for bank wire transfers. A crypto currency eliminates the high cost and multi-day withdrawal from gambling sites. The key to success in insurance is not related to the currency. A new currency does NOTHING for the insured nor does it improve an insurer’s operating costs or COMBINED RATIO, which is one factor to profitability.
Their white paper states:
Quote
“That’s why leveraging our 20 years experience in risk assessment and scoring we are creating REGA Risk Sharing platform - the new standard for insurance market with state-of-art technology that will be available for everyone as a new segment of the shared economy.”
Does Rega Crowdsurance think that their 20 years experience in risk assessment is superior to Berkshire Hathaway’s 60 years experience in risk assessment? Even though AIG has 100 years of experience in risk assessment, they almost went bankrupt.
What makes Rega Crowdsurance think they know more than anyone else in how much to charge you to insure your car against the next accident?
Even if Rega Crowdsurance thinks they know risk assessment, there is another major factor to profitability: KNOWING HOW TO INVEST. Let’s say you are an insurer and you collect $100 million of premiums, which is called the PREMIUM POOL. You won’t have any claims until the next hurricane. What you do with the premium pool is critical. You cannot let it sit there to collect dust. You have to invest it. Where and how are you going to invest it? Quite often, insurance companies lose money from underwriting (risk assessment) and make up the loss from their investments. The majority of profits for Berkshire Hathaway comes from how the premium pool is invested. What makes you think Rega Crowdsurance knows how to invest?
Their white paper states:
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“Compared to traditional insurance, in crowdsurance there are no insurers, intermediaries and brokers, all the processes being controlled and managed by programs and algorithms.”
Yes, there are insurers: other users. GEICO has had no intermediaries nor brokers for 70 years. Other insurance companies exist without brokers.
If you are a Rega Crowdsurance user, you will be an insurer or insured. If you are an insurer, are you going to go through the hassle of complying with the multitude of state government regulations on insurers?
If you are an insured, is the state government going to make sure that Rega Crowdsurance is properly capitalized so that they will have enough to fully reimburse you and all of the insured when your cars are destroyed?
Their white paper addresses regulations by stating this:
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“We ensure regulators to comply with all necessary procedures including identification of platform members, working according to current jurisdiction legislation. Internal policies are designated to prevent and mitigate possible risks of the platform being involved in any kind of illegal activity. REGA Risk Sharing adopts risk-based approach to combat money laundering and terrorist financing. The principle is that resources should be directed in accordance with priorities so that the greatest risks receive the highest attention. Upon request of regulating authorities we disclose all information concerning the case, if that information can not be found in public blockchain.”
Most of this is verbose. The rest is misleading. Regulations of insurance is not related to illegal activities or money laundering. They are there to make sure that the insurer has enough money to pay all of the claims.
Rega Crowdsurance is extremely is extremely high risk, unless it is being started by former executives of GEICO, State Farm, etc.
Also, they are in a country without extradition agreements. If they screw you over, they are immune from punishment from your government. This makes them more invulnerable and likely to make any claim they want.
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