This Is Why Social Media Indicators Have No Business in ICO Ratings

ICO rating platforms place substantial value on social media indicators. The problem with this is that likes and shares not only reveal little about an ICO’s chance of success, they are also often falsified with purchased followers. That is why serious ICO ratings should dispense with embellished social media statistics and instead place the focus of their valuations on factors that are really important for investment decisions.

Telegram followers, Facebook likes and retweets — social media statistics have long been key cross-sector indicators for measuring success and failure. In particular, in the still young world of ICOs, what generally applies is: the more hype, the better. For instance, the vast majority of ICO ratings platforms still list social media figures as important indicators of an ICO’s value.

However, what might appear logical upon first glance, is ultimately a huge problem for investors who are looking for independent and credible information for their investment decisions — for various reasons.

Social Media Statistics Are the Wrong Measured Value

In principle, one has to question whether the number of Facebook fans is any indication of the meaningfulness or medium-term chances of success of an ICO. After all, ICOs are not in a competition to break new social media records, but rather to develop technologically sophisticated innovations.

Those who invest in ICOs have to know whether the project team is in a position to navigate the bumpy road from good idea to successful company, and not whether the team can build the largest possible community. For this reason alone, it would make sense not to include social media figures in the metrics used to evaluate an ICO.

Buying Followers Has Long Since Become the Norm

However, there are even more serious reasons. It has long been commonplace for ICOs to buy followers for their diverse social media channels and, in so doing, embellish their statistics. This kind of deceptive behaviour is also becoming rampant because it is so incredibly cheap.

Anyone who wants to buy 5000 followers for their Twitter account need not shell out more than 50 US dollars — a trifle considering the enormous sums in circulation in the crypto world.

On top of that, access to these kinds of providers, who sell followers for a small fee, is incredibly simple: a Google search and a few clicks suffice to purchase followers at bargain rates in just a few minutes.

As such, it has become normal for ICOs to purchase followers to suggest community interest that actually does not exist. In turn, this investor fraud is rewarded by ICO rating platforms that rely on social media figures as a basis for evaluating ICOs without acknowledging that these followers might include a large number of purchased supporters. Bounty campaigns, which nearly every ICO uses for promotional purposes, also create a false image of actual community interest. Although followers are not explicitly purchased, they are rewarded with tokens for their posts, shares, and likes.