How to Fail ICO pt.3

Alphateca / DATE: 09/12/18

Part 3. Meddling with legality

*previous part you can read here*

Since we wanted to run our business properly, the first thing we had to deal with was the legal system. We started looking for a country where the government treated crypto alike with other currencies. Many countries have proved to be more reasonable by imposing their regulation standards. Simply put, some politicians had spotted the circulation of money they could have gladly taxed; some banks went all excited, as they had spotted people making transactions and therefore they had been losing a part of their income, but… There is always a “but” and in this case it was decentralization and quite a high degree of anonymity, thus an absolute inability for the government to control it.

Nevertheless, some countries began setting their own loyalty programs and banks started cooperating with crypto owners in order to minimize the leakage of revenue. However, as often happens, at first they did not succeed. For example, some countries expressed the readiness to accept Bitcoin and other crypto as a currency, but they lacked banks willing to work with it, and vice versa. The most advanced countries were European ones, such as Swiss and Germany. However, there were some other nuances. For instance, if you wanted to introduce your own crypto, you would have to become a part of SRO, get a license and commit to paying duties and taxes regardless of the amount of income. And this is only a small part of problems one comes across while aims at working legally, especially considering the international format of work.

The resolution was as follows:

  • Choosing the most suitable jurisdiction with the positive attitude to cryptocurrencies;
  • No requirements to operate on the territory of that jurisdiction;
  • Finding an opportunity to establish a company in another country;
  • Choosing a bank with a greater potential for working with crypto and an opportunity to open accounts for foreigners.

But then we made another mistake. We failed to consider the factor of confidence in the foundingcountry. Our choice fell on the Cayman Islands and later we often saw the faces of our partners changing as we mentioned our jurisdiction, given that despite its loyalty to the crypto, this place had been an oasis for underground offshores. Undoubtedly, it damaged the reputation of the company.

Mistake 5. Choose the trusted country.

In our business starting a company is the initial part of work process, the next step is the legal justification of a token for an ICO.

As I mentioned in the previous chapter, there are two types of tokens – utility and security. If you claim your token as security, consider it the equivalent of security papers. Accordingly, soon you will likely acquire a fan club in the form of regulators, such as FTC (Federal Trade Commission), who will dig deep into your business before they invite you to go on a jail tour.

Besides, there is a good questionnaire, which can help you to find out the type of token you have. You should remember that even if you come up with a brilliant plan how to disguise the token, SEC would only estimate the result, i.e. the intention to reap the benefit. We chose the utility token so owner can claim our services with it.

The ATEC token complied with the following criteria:

  • The token can not be used outside the website;
  • It can be used for buying special services only within the project.

Further we realized that despite we had been doing our business fairly, investors did not show much interest for the ATEC token as they were used to “buy for $1, sell for $5” way of trading and remained indifferent to the social part of the project.

Mistake 6. ICO participants want to make a quick profit.

If you are interested to learn more details about the legal part of the ICO process, leave a comment and we will tell you about our experience. In the following chapter we will write about advisors and their significance.


How to Fail ICO pt.2

Alphateca / DATE: 09/06/18

Part 2. How we have been preparing for the ICO.

*previous part you can read here*

Gathering our thoughts, we started preparing for the ICO and the first step, of course, was to sum up the information. We had to analyze which ICOs appeared to be successful and which did not, as well as observe the fund-raising all in all. We looked through accessible databases to list our ICO, created a spreadsheet and embarked on the further investigation. By that moment, the situation was as follows:


- Mainly the ICOs which did not have an actual and valuable concept had failed;

- Those who participated in the Asian market succeeded with token sale;

- There has been a huge percentage of SCAM. Some teams just collected money from investors and then disappeared;

- Some ICOs were prosecuted because of the government position remained unstable.


Having considered all the information, we made a decision to release the MVP as our first project. Unlike most of similar projects, it had to be a functional version, ready for usage – available for placing items, selling and buying goods and services for cryptocurrency. We chose that path, because ICO was our final target that would generate income and we were sure that our community would have trust in us and give our project a warm welcome.


Mistake 2. There was no connection between the readiness of the MVP and the willingness of people to invest in us.


Besides, since our main task is the work of our project, we became more careful with legal documents and decisions, which we will review in the following chapter. The important point is the international law and compliance with the law, especially in the regions where cryptocurrency is treated with caution.

By the moment we started preparing for the ICO, the cryptocurrency market has already remained in stagnation. And on top of all, new regulating factors concerning cryptocurrency and ICO have appeared.


Mistake 3. Choosing the time for ICO consider the changing trends of national laws.


As we mentioned before, we had had no experience of starting our own ICO and that was the reason we decided to consult with those who could share some ideas. If you try to google or ask your friends, you will certainly find at least a couple of people who claim to know how to start an ICO or has done it himself. The best you can do is to keep your composure and not take much on trust. Many people nowadays tend to overprice their service as they hear the word “crypto”, and we came across that as well. Some time after the ICO events were over, I happened to become allergic to the number “250,000”, as it had been demanded as an average price nearly for any kind of work we needed to be done. In dollars or euro, of course. Besides, very often people tried to overestimate the amount of work, adding some tasks similar to “sitting and thinking about life” for $10,000 each. The most important thing, however, was that the majority of companies or advisers we found, in fact, were just facilitators and had no real experience of launching an ICO. They were nothing, but theorists. Crypto-theorists.


Mistake 4. Do not hire advisors to run the whole ICO give them exact and particular tasks.

The most unpleasant thing about this: briefings take much time while in the end you often get nothing more than empty promises. And briefings are held during the most vital marketing and project development time. Also there’s always a risk of being deceived by the people with fake reputation. We asked some advisors directly which ICOs they had launched, and then we asked the founders whether they knew those people. You may guess the answer.

Finally, we came to the conclusion that such people couldn’t provide us with useful information and decided to elaborate a strategy internally. It all began with the target audience. On the one hand, the crypto marketplace and ICO were attractive to the same audience – people who own cryptocurrency. On the other hand, as it happened with the marketplace, it was people, who treat crypto as a means of payment, while for the ICO it was those, who invest in it. At this point, we came across another problem – we could not legally enter the market having security tokens, while utility tokens would not make any income for owners. But we will review these features in the following chapter.




Alphateca / DATE: 09/04/18

Alphateca ICO legacy


Part I

 Roots. The First Mistake.

We failed our ICO. It could be the end of the story, but in this case scenario you would never know how it all began, turned out and the things you should NOT do. Minor accords are twinkling above Alphateca ICO; nevertheless, it was a huge experience, and we want to share our story with new crowdsale participants.

It had begun long ago. A lot of happy thoughts were jumping in my head thinking how cool it would be to implement any platform with a convenient, safe and simple way of trading. Certainly, there's eBay and Amazon, Avito and Alibaba, as well as many other platforms. Still, you can always do better; they have a sufficient number of inconveniences, and they do not use cryptocurrency, which has recently started penetrating into all spheres of life.

We aimed to implement a blockchain platform that will allow people to trade without borders and restrictions, as well as give an opportunity to create or transfer one's business using numerous services without leaving one site.

So. Having gathered all available forces and the team, we began to carry out the project. Indeed, I realized it would be challenging to use own efforts of the team only regarding such a large-scale project. International marketing is a kind of notorious story. That is why I decided that an adequate way to attract resources for the company will be an ICO, and the implemented tokens can be used to purchase paid services on the site.

As far as our ICO was not the final stage of our project, we are still planning to develop, regardless of the result. Let me remind you that first, we created the alpha-version of the product, and then launched the ICO, expecting to increase loyalty to the company due to the possibility of investing in a ready, tangible product.

We were skilled theoretically, but we have never had any practical ICO experience, so the lumps still go. The ICO date started precisely a month later from the launch of the alpha version which took place June 1, 2018. So here we go - mistake number one.

 Mistake №1: While choosing the ICO date, take into account not only the readiness of the product but also the seasonality. There are always months with a total stagnation of ICO.


                                                                                Author: Ilya Stenkov, Alphateca founder



7 Spheres of Blockchain

Alphateca / DATE: 08/31/18


Blockchain technology has been penetrating in various spheres of our life:

1) Education

Blockchain technology is relevant in all stages of education: schools, colleagues, universities, apprenticeships, MOOCs, CPDs. It can be used as a shared resource to store and deliver certificates including distant education, affiliated organizations.
As soon as paper prone to be fraud, a decentralized database of credentials and documents is essential. Some universities, such as Princeton University on Coursera, have implemented MOOCs based on blockchain technology.

2) Banking

Using blockchain helps to transform payments at scale and reducing risks. Shifting on to cryptography allows having simultaneous access to constantly updated digital ledger that cannot be altered.

3) Logistics

Shifting on to blockchain technology allows having all documents on a shared distributed ledger. The technology enables having all separate communications of the logistics recorded immutably and accelerates customs clearance.

4) Medicine

Healthcare is commonly using blockchain regarding facilitating tracking capability in the supply chain of drugs and other treatments.

5) Video games

Blockchain technology and Smart-contracts make video gaming more transparent as players can view rules, payouts, scoreboards. This builds a stronger bond between developers and the players.

6) Art

Blockchain makes art a better investment: financialized art markets, decentralized artist collections with using of AI (Scarab Experiment), cartoons with the cute cats that can be sold, bought or bred with crypto, or just several donations.


7) Voting system

Provides transparent and accurate election results.



Alphateca / DATE: 08/29/18

According to the data published by Google Trends, current businesspeople and owners of large enterprises in Europe, Russia and Belarus are increasingly introducing payment with bitcoin.  Cryptocurrency as a means of payment is becoming a trend in e-commerce that leads to an increase in income. The number of cryptocurrency  ATMs expands exponentially.



TREND 2018

In 2018, cryptocurrency payments will become a real economic trend in the modern world. Cryptocurrency payments will help to surpass opponents in the business sector, underline the cutting-edge approach, attract new customers, and this will immediately affect the budget grow.

It's no secret that the issue evoked a band broke-up, and the acceptance of payments in bitcoins in Europe, Russia, and the United States became hugely profitable. When the business moves with the times, it attracts a new audience, increases competitiveness, brings the industry to a new level.



Just imagine what effect will make your website note that you're accepting bitcoin payments. This will be precisely the PR that will propel you to the top of the ratings, as well as the media coverage presenting you as loyal to modern technologies.



When you accept online payments using cryptocurrency, it requires the lowest percentage than all known international payment systems take. The nominal cost of the transaction depends on the load of the network, but it will always be lower than an ordinary bank fee for the international sale.



It is hard to believe, but this is the system that eliminates the risks. The payments cannot be canceled or blocked. The system works, and it is confirmed by many clients in any corner of the globe. Using modern blockchain technology makes any fraud impossible.



Users' money flows cannot be stopped, banned or charged with additional fees. In this case, the banking institution has no power over transactions. No one will violate the confidentiality of the process; everything will be delivered quickly, accurately and anonymously.



More customers – more sales:

Indeed, current customers appreciate trading platforms accepting bitcoins. When the merchant reports that from the onward you can make cash payments in cryptocurrency, it will immediately influence the sales volume, the flow of customers, and marketing will work automatically.



A common phenomenon: sometimes international payment delays due to the banking system (working hours, holidays ) occur which may impact overall income. Making payments in cryptocurrency, you will receive your funds within 5-10 minutes-regardless of weekends and holidays.



There is no limit on payments:

No other payment transfer system will allow you to transfer funds without any restriction. Here the client is not restricted in the amount of payment.



Being a businessman of the 21st century, you clearly understand that cryptocurrencies and blockchain are the future of payments in any country. This is a new trend, but it is so profitable, convenient and modern that it is worth introducing cryptocurrency into your business right today. It's your chance to be one step ahead of all your competitors.