CCE Initial Coin Offerings (ICOs) 2

Question 1

Which regulatory body issued the 2017 'DAO Report' that significantly impacted ICO regulation in the United States?

Accepted Answer

SEC

Answer

The SEC issued the 2017 DAO Report, concluding that DAO tokens were securities and establishing that the Howey Test applies to token sales.

Question 2

In ICO terminology, what is a 'hard cap'?

Accepted Answer

The maximum total amount of funds an ICO aims to raise

Answer

The hard cap is the maximum amount of funds an ICO will accept; once reached, no additional contributions are accepted.

Question 3

What distinguishes a 'utility token' from a 'security token' in the context of ICOs?

Accepted Answer

Utility tokens grant access to a product or service rather than representing an investment contract

Answer

Utility tokens provide access to a platform's functionality, while security tokens represent an investment expecting profits from others' efforts.

Question 4

What is 'vesting' in the context of ICO token distribution to founders and team members?

Accepted Answer

A schedule that releases tokens to insiders gradually over a defined period

Answer

Vesting schedules release tokens to founders and team members over time (often 1-4 years) to align incentives and prevent immediate dumping.

Question 5

Which document in an ICO provides the technical specifications and detailed description of the project's blockchain technology?

Accepted Answer

White paper

Answer

The white paper outlines the project's technical design, token economics, use cases, and roadmap for potential investors.

(CCE) Certified Cryptocurrency Expert Practice Test