We at Cryptovest recently had the opportunity to interview one of the most interesting figures in the booming ICO space. A serial entrepreneur, he has decades of experience as an online marketer, has worked extensively in product and service design, used to run political party campaigns and once even raised $2 million in funding without any product.
Itay Adam isn’t someone you hear or read about in traditional media. Behind the scenes, however, he is one of the current ICO campaigners. Being a political campaigner, he gained experience which gives him the unique insights he employs today to push ICOs.
In our interview, we picked his brain on a variety of topics, from ICOs to the future of Bitcoin and even crypto-critics like Jamie Dimon.
CV: Thank you for joining us today, Mr. Adam. We’d love to hear about how you started with crypto and how you see things today.
IA: Thank you for having me. I got into cryptocurrency in 2010, when someone I knew gave me 3 coins. At that point, I think Bitcoin was trading at 80 cents. I didn’t have the time to look into it then, and by the time I’d done my research, it was already priced at $8. So I thought, “If it’s 10 times what he bought it for, after such a short period of time, I am going to buy some more. And I did...”.
CV: How did things get from then to now? From you getting into Bitcoin to working on ICO campaigns?
IA: I don’t know why and how it started, but the crypto community in Israel started coming to my place, sitting in my studio every Friday to think of concepts. These were cool, honest guys with the passion to create. We would discuss the technology at length, and I mentored them and helped them plan their product launches.
CV: How important, according to you, is making people understand what the product or service does?
IA: The crypto community is full of geeks. They are very talented people but they don’t really understand marketing. You can find people launching a product like Golem, but no one knows what Golem is. This is where I come in. I look at an ICO as a campaign you run for a candidate to an office.
CV: That’s an interesting approach, treating ICOs like campaigns for office. How does that work out?
IA: ICOs are like political campaigns. When I run an ICO campaign, I want your trust and I want you to believe in me. If you vote for me, or buy a coin from me, something good will happen. It’s the same narrative.
CV: What do you think is the industry’s major problem?
IA: I met with Vitalik Buterin, the founder of Ethereum. We had a meeting in Cornell; I came especially for it. I didn’t know Vitalik but we had a talk. I told him the biggest problem of the ICO industry is the fact that it is not transparent.
If I am investing $100 in a company, I want to know everything about the company, including how much money the CEO is taking home in salary. How much do his airplane tickets cost? Is he flying first class or economy? I want to know all of this. Say what you will, but that’s the kind of investor I am. If you want my money, be transparent.
This lack of transparency leads to lack of faith, which is the biggest problem for the industry at the moment. It’s the feeling of being robbed, the feeling of “I don’t know if they are going to actually follow-through on their promises”.
CV: How do you vet an ICO before you join the campaign? How do you make sure an ICO is legit and worth putting your weight behind it?
IA: First of all, I try to find sense in the product. If there is no sense, it doesn’t matter how much money you have from investors and how big your community is. If people are not going to use the product, the company is going to die.
So the first test is whether I am going to use this product or not. The second thing is the team. Who are these people that we’re talking about, what have they done, what are they doing now, and why are they doing it?
If they say, they want to monetize this gold rush, I am out. If they tell me, “We want to be the next Uber because we believe in the technology, but no VC will back this at this stage,” that’s something that I find interesting.
Then you look at the token that is being offered. Is it just a token created so they can raise money, or is this a sort of a key that is needed to solve problems?
If you look at an ICO as a tool to raise money from the public, you’re missing the big picture.
CV: When you choose an ICO, how do you work with them?
IA: I work very exclusively. Every ICO campaign lasts roughly a quarter and I don’t accept more than one campaign a quarter. I need to choose my campaigns very carefully.
CV: What is your take on scams and frauds in the ICO industry?
IA: This is another thing that we need to talk about. It’s the nature of the people that anchors this market. People think there is a gold rush, everyone comes up with an idea, but let’s be honest - a majority of those who launch products and raise funds, have ZERO willingness to actually build the products. They are looking to scam people. This is the truth and something that needs to be said out loud so we can fix it and move on to building amazing products.
You should never, ever invest in a PDF company (where all you have are some documents and no faces or product); they are not people who want to build something. They are only trying to surf the wave and take in as much money as they can. If you remove these folks from the equation though, you’ve got yourself a brave new world.
ICOs are great for raising funds but unregulated ICOs are an issue. Back in 1995-2005, the online commerce space was riddled with hacks, scams and frauds. Now, however, things are clearer and most people do not fall for the old tricks. The same will happen in the ICO and blockchain space as people get smarter and scammers move on. I believe we will start seeing these changes in a few months.
Allow me to share an example of a killer team: Zen Protocol. That’s a token I am waiting to launch in an ICO. These guys are doing the right work, building the product day and night. When you are looking into a company, you need to invest in a company like this. Put a camera in Zen Protocol’s office and you’ll see them burning the midnight oil. They are the good guys.
In any ICO, you need to check again and again and again, whether the team is actually into building a product. You need to figure out their “why” – that is very important. Invest your money only after checking their foundations and understanding their motivations. Call the CEO, talk to the CTO, check and re-check the fact that you’re dealing with real people, building real stuff with real skills.
You are basically the board, you are the VC, you are the advisory, you are the everything. By buying a coin, you become a shareholder and you need to do your due diligence.
This industry needs a solution that is going to uncover the real identities of the people behind every product. You’re going to find many scammers in the sphere. Scammers are always the first to come and the first to leave. They will be gone soon.
It’s just a phase. People are going to want answers soon and the SEC will catch up. And that’s a good thing. If you regulate the space and educate the people, in no time you’ll have a stable market with products launched by the best of the best entrepreneurs out there. As for the scammers, they are digging their own graves.
There are obviously others, like Vitalik and so many guys I know in the crypto community, who are not looking to scam people. They are looking to change the world and build stuff that will last forever.
But you have to find these guys among the thousands of ICOs launching every day, with people that are promising things and delivering nothing. That’s the main problem of this industry at the moment and the only person who can change this is Vitalik Buterin. I believe that there’s a need for a transparency protocol and we need to get united behind a certain one. Once that happens, the industry will boom, and the only one who can launch it in a way that the sphere will adopt it, is Vitalik.
VC: What do you propose Vitalik should do about this situation?
IA: Build a transparency protocol. Every ICO should be committed to it so we can know where every dollar ends up. We have the technology to do this. Every token has a number, so I can and I should be able to track it.
Raising funds does not mean you made a profit. It’s funding. It’s not your money; it’s my money. I am not asking you for any information on your personal spending, but I need to know where my money is going.
CV: What is your opinion on the future of Bitcoin and other cryptocurrencies in light of recent developments, where governments are working on their own digital currencies?
IA: I believe that the only real power of governments lays in their bills. Moving to digital currencies will weaken them. These days, when you hold cash in your hand, you feel that it’s money. Everything else is just digital, and you would rather have a dollar bill than a digital coin.
The day that you’ll no longer need to “feel the bill”, will be the day you’ll consider the Facebook coin at par with the dollar. In fact, some people may believe in the Facebook coin more than they’ll believe in the dollar. That being said, I think that in the next 2 years we will have 200,000 tokens and in the next 10 years, we will have 20.
We will still need and want a private coin to serve as cash. Cash will always stay and people need a currency tool that they can use to transfer value among themselves privately. This may turn out to be Bitcoin/Ethereum or any other token that can gain public attention and unite the community.
CV: What do you think of Bitcoin critics and haters, like Jamie Dimon?
IA: What Jamie is doing is called stock manipulation and he doesn’t answer to anyone.
What if I am the head of Goldman Sachs, and I say Facebook is gone, everyone who holds a share in Facebook is a complete idiot, and I am going to fire those who work for my company? Facebook’s stock drops, and then I buy it with my billions of dollars. I just stock-manipulated the market and I should go to prison.
Major banks understand that they are living on the Titanic and this is the end. It’s the last decade of the banks - everything is going to change in 10-20 years from now. Roll with the change or be gone. That’s the fact.