Dutch ICO HeadStart raises over €10 million

Dutch FinTech company ICO HeadStart raised 10.2 million dollars in the first phase of an Initial Coin Offering (ICO) over the weekend. The goal of this so-called pre-ICO, which is running until December 12th, was 10 million dollars. The actual ICO, which is still to come, is expected to raise even more, Business Insider Nederland reports.

The ICO HeadStart website calls the company "the safest ICO fundraising platform". The company offers ICO proposals that were pre-screened for safety. "We offer our community access to the safest ICO proposals which have been carefully selected by experts from our compliance department, while adhering to give them the best possible ICO proposal and the highest security standards in the ecosystems", the website reads. 

An ICO is often described as being in between an IPO and a crowdfunding action. Investors use cryptocurrencies like Bitcoin or Ethereum, or sometimes traditional currency with a credit card, to buy tokens that in some cases are like shares in a company, and in other instances are used like currency to make purchases or support nonprofit organizations.

The process is rather controversial in the Netherlands, as it is unregulated. The Dutch authority on financial markets AFM does not supervise ICOs as they don't fall under its mandate. The AFM previously warned that ICOs are  vulnerable to deception, fraud, and manipulation.

According to Emerce, there are warnings online that ICO HeadStart founders Nawid Habib, Aleksandar Martinovic en Seyed Mozafar Niazi were involved in collapsed pyramid scheme Levilon in 2015. According to MLM Forum, the company's chief operations officer Martin Bylsma was also involved in various pyramid constructions.