# kaal:claim:3606663-011

**Claim.** Capped ICO raises, adopted by the crypto community to reduce investor uncertainty about platform valuation in uncapped raises, backfire because the cap creates strong incentives for investors to get in first, raising the likelihood of retail investor frenzy.

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

**Holds when.**

- capped ICO raises
- retail investor participation

**Source quote.**

> However, capped ICO raises create significant incentives for investors to attempt to get in first, raising the likelihood of retail investor frenzy.

**From.** Kaal, *Digital Asset Market Evolution* (2020), 4. Regulatory Uncertainty, page 36

**Cite as.** Kaal, Digital Asset Market Evolution (2020). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3606663

**Verify.** sha256 of source PDF `d1d4a15a293b715bb6a5a32e689f59c3a1587915039ba9a1cf4eeb8ee2a1e57c` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202020%20-%20Digital%20Asset%20Market%20Evolution.pdf

**Failure mode.** capped raise induces investor frenzy  (family: staking-and-incentive-misalignment)

**Topics.** securities-law

**Keywords.** ico, retail-investors, caps, investor-protection, unintended-consequences

**Related claims.**

- extends: https://wulfkaal.github.io/claims/3067615-035

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.