The idea of cryptocurrency investment has penetrated into several areas of the society today. From those who barely have enough experience to experts who want to make quick money, cryptocurrency has easily become the investment plan of choice. Investment in Initial Coin Offering (ICO) is just one of the three ways you can make good money through cryptocurrency.
What is an ICO?
Initial Coin Offering (ICO) is a way through which new or relatively new cryptocurrency organizations raise funds for the development of their platform or project through token sales in exchange for cryptocurrency such as Bitcoin or Etherum.
Although some organizations may launch their ICO platform when there is a need to fund an already working product, others may launch theirs with just their whitepaper idea and sales page. Hence, the token may vary in terms of their importance in specific projects. However, it basically gives its holder the right to access a few features available on the ICO platform.
Why ICOs?
The ICO idea is a novel one. It has not only made it possible for startups and organizations to fund their project, but it has minimized the hiccups associated with investing in new ideas and innovations. What’s more, with ICOs in place, anyone can decide to invest in their favorite technological project at its tender stages.
However, it is not all so rosy. Although ICOs give investment powers to an investor, it is possible to get unpleasant results. Factors such as inexperience, lack of education, improper research, and greed for quick gains can cost an investor a lot. As is the case with any other investment, diligence, research, and proper analysis are crucial parts of ICO investment – and cryptocurrency investment in general.
How can you invest wisely in ICO?
Research
You would definitely find lots of success stories about people who have made millions through investment in a variety of crypto tokens and coins. Success can only achieved following several hours of market research and analysis to ensure they select the best teams and platforms. There are a few indicators that help reveal the weaknesses and strengths of a project. Here are a few pointers to guide you when considering a project.
ICO Buffer Listing
Using an ICObuffer listing will help you identify reliable ICOs for your crypto investment. There are a wide range of reputable websites where you can find great updates and accurate data about ICOs. You can use the ICO buffer listing as provided by these websites to get extensive information before investing your crypto.
Team
It would be ideal to check out who is developing the product. Ensure they have a strong and reliable technical team in place – one that can help transform the technological idea into a viable business. Try to observe if there are also advisors to the business and most importantly, do not settle for only the information you find on their website. A thorough background check on platforms such as Twitter, Google, LinkedIn, and other reputable forums would help you decide if the project is the real deal.
Prototype and Project Roadmap
An ICO project essentially involves fundraising for the development of a project to increase the value of such project. If a project’s idea or product is already achieving some level of success and is available to the public, its value increases massively. The further the developmental success, the better for an investor. Considering the roadmap is also a great idea. It is an ideal way to learn about the commitment of the team and the timeframe for different levels of success. Knowing the project roadmap would also help you track the milestones in real time.
Token Structure
Although ICOs are structured along the same set of details and variables, it would be ideal to check out the structure of the token sales. The important variables to consider include:
- Token Bonuses – While it is normal to like bonuses, you must remember that outrageous bonuses do not make good ICOs.
- Token’s Use Case – Check out the plans for the token’s use case. Where does it fit in the project’s model? Would it be used as a utility?
- Participation Details – Are there restrictions on the kind of countries allowed to invest? Is there a rigid cap on the maximum amount for investment?
Project Community
Is there a thriving community behind the business idea? It is especially ideal that you checkout the level of interest of outside investors if you hope to sell large amounts of cryptocurrency. Consider the size of followers. Although it may not always be the case, cryptocurrency projects with a reasonable level of following have better access to resources and stand a better chance of success.
Relevance
This is arguably the most important factor to consider before making your decision to invest. Does the project feel exciting to you? Does it solve a problem for you? Do you believe in their vision? And do trust their team?
With better understanding of the mode of operation of companies and their ICO offerings, it is now time to get to the real business as you are better equipped to make informed decisions. Although the process might vary from company to company, here is a general guide to direct you on the path to ICO investment.
Create an Etherum Wallet and Get some Ether
A wallet helps you store Ether so you would need to create one. A wallet such as MyEtherWallet gives you complete control of your wallet – and privacy. Once you have an Etherum wallet, get some ether. Since ether is accepted as contribution by most ICOs, you would need to get some ether to allow you participate.
Transfer the Ether
Contributing your Ether to an ICO means that you must send the crypto from a personal wallet address. As such, you would need to transfer the Ether to the created wallet.
Transfer the Ether to the ICO address
Once all the elements for the contribution are in place, you can now send the Ether to the ICO address. You can begin by using the company’s website to register for ICO. This will ensure you are whitelisted as an ICO investor. Different companies may require different details. While some may be content with your email and wallet address, others may ask for other personal details. Following the registration, the company would provide you with instructions including the public address where you would be required to send your Ether once the ICO begins business.
As a reminder, always ensure you understand the project idea and structure before investing to avoid the risk of losses. Before investing in an ICO, make good use of ICO buffer listing, focus on the long term project rather than the gains you hope to enjoy for the short term. Engage in research – trust your findings, and shut out any hype.
