# kaal:claim:3067615-026

**Claim.** Because token offerings are built on open source code, the utility of an issued token can at any time be recreated in another token with essentially identical features at marginal cost, so investors cannot rely on the implicit promise that promoters and developers will increase the value of the acquired token rather than launch a duplicate.

**Type.** failure  **Support.** argued

**Holds when.**

- token offerings based on open source software

**Source quote.**

> Investors cannot rely on the implicit promise that the token promoters and their developers will increase the value of the acquired token and not create another token with identical features.

**From.** Wulf A. Kaal, Marco Dell'Erba, *Initial Coin Offerings Emerging Practices, Risk Factors, and Red Flags* (2017), IV.3 Open Source, page 18

**Cite as.** Wulf A. Kaal, Marco Dell'Erba, Initial Coin Offerings Emerging Practices, Risk Factors, and Red Flags (2017). SSRN: https://ssrn.com/abstract=3067615

**Verify.** sha256 of source PDF `164ce15b9eb1e8847ebcb073f5b23a96b4974ad0308d77469a9455d4a1ebeb38` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20and%20Dell%27Erba%20-%202017%20-%20Initial%20Coin%20Offerings%20Emerging%20Practices%2C%20Risk%20Factors%2C%20and%20Red%20Flags.pdf

**Failure mode.** Open source token cloning  (family: valuation-and-pricing-failure)

**Topics.** open-source-and-code, tokenomics, economics, risk-and-incentives

**Keywords.** open-source, token-cloning, competition, investor-risk

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