Is this also true of all startups that take funding and then fail? That would be one reasonable definition of "scam" I think, but personally I think it is more useful to have different terminology for speculative high risk ventures that make a good faith effort but fail vs. malicious schemes designed only to take money and run. I think there are lots of both things in this cryptocurrency space, but I think it's reductive to throw your hands up and say they're all the same.

Debating myself a bit: the reason startups tend to attract fewer scams is that only accredited investors can invest in them. There is definitely something to be said for that!

Generally you're only going to get decent money from bigger names (or at least one leading the round) - and a bad reputation will make it quite unlikely you'll get to play again. This helps avoid many straight-up scams like Dentacoin (lol).

Then, your future rounds of investment are conditional on demonstrated success. Your A can be a bridge round based on traction or a materialized idea. However, your B is generally based on hard numbers.

ICOs tend to get series F/G money up front on a hope and a prayer.

Circle CI raised $100M in a Series F. Check out this whose-who of token failure that all raised the same amount or much more on day 1 (https://decrypt.co/53950/the-10-biggest-icos-heres-where-the...).