Educating the masses on potential risks associated with cryptocurrency and ICOs is a tedious challenge. Nefarious projects continue to dupe investors, mainly because people don’t always bother to conduct their own research. The US government has now launched a fake ICO website to demonstrate how easy it is to attract investors with a semi-professional website.
HoweyCoins Serves an Educational Purpose
For those who are unable to tell by looking at the HoweyCoins website, it is not a legitimate project. This is an educational venture launched by the US government to make consumers aware of potentially shady initial coin offerings. The website claims that ‘HoweyCoins’ are officially registered with the US government, which is clearly not the case.
While some of the outrageous claims on the website are more blatantly false than other hidden gems, the project could easily attract unsuspecting investors. It has all of the trademark signs of a potentially legitimate project if one doesn’t know what to be wary of. The promise of profit is a dead giveaway, yet HoweyCoins.com clearly displays it on its main page.
Additionally, HoweyCoins claims its tokens will work with any participating airline or hotel. While that sounds potentially legitimate, it is evident no company would take a gamble on such an unknown cryptocurrency. After all, most companies oppose Bitcoin, Ethereum, and the like. Those coins are legitimate, entrenched cryptocurrencies with solid reputations that go back multiple years. If those currencies aren’t accepted by the majority of airlines and hotels, HoweyCoins doesn’t stand a chance.
There is also an interesting whitepaper associated with HoweyCoins which is worth checking out. Although a whitepaper gives any project a lot more legitimacy in the eyes of an untrained individual, it is usually a glorified PowerPoint presentation which promises the stars and the moon without being capable of actually delivering anything. HoweyCoins is no different in this regard, but it disguises it quite well.
Additionally, the page takes a jab at some of the current trends in the world of ICOs. First of all, it includes some celebrity endorsements. As we saw with the Centra ICO among others, a celebrity endorsement doesn’t make a project any less prone to fraud. There are also a few package tiers to contend with, which further pokes fun at how ICOs attract investors at an early stage through discounts and additional tokens.
All things considered, the US government is taking a very interesting approach in this regard. Purposefully launching a fake ICO to drive home a point is remarkable, and it’s more than welcome. Investors need to be a lot more careful when it comes to initial coin offerings. The majority of these concepts will fall flat, or fail to come to market in the first place.