Log in

ICO Investing: How to Purchase Initial Coin Offerings


One of the keys to investing success? Getting in early. Imagine becoming one of the first investors in a tech company like Google or Facebook for example. What about your life might be like if were able to buy ICO (initial coin offering) products for a giant cryptocurrency like Bitcoin or Ethereum?

Your portfolio might appear different, right? It's possible to have a chance that you can get to participate in the next IPO or ICO.

In this piece we'll go over ICO investing, the best way to buy ICO coins, as well as where you can find ICO listings. In short, if you're still all "IDK" about ICOs, you're about get an education.

What Are ICOs?

They are similar to IPOs in that they are the first public offerings which mark the first time that the public can purchase the shares on exchange. The key difference is ICOs deal with the sale to the public of crypto, whereas IPOs concern stocks.

In the same way that some investors invest in IPO investing, they could participate in ICO investing, as well. This basically means investing in a stock, or a cryptocurrency, as soon as it's listed on the market with the expectation (or hope) of it increasing in value

IoTs have now become a major market. From 2016 to the end of 2019, over 7,400 ICO attempts took place with a combined total of $35 billion.

How ICOs Work

The companies that go public or IPO go on the market in order to raise money. They're essentially selling pieces of their possessions in exchange for cash. The same principle is applicable to the ICOs that are crowdfunded efforts to support a revolutionary cryptocurrency.

A ICO could be defined as "initial coin offering," which lets crypto investors become part of the floor of a cryptocurrency startup. Investors in ICOs are part of the first wave piling into new cryptoand, therefore can benefit the most should (and it's a huge "if") the crypto one is gaining value.

In terms of how an ICO actually works? It's different from an IPO, which has an extremely standard procedure that involves different parties as well as regulators. The process of bringing crypto into the market is something that can be done by yourself. In short, the group behind a revolutionary crypto outline their plan in a white paper for the new crypto system explaining what it's about and how it's going to work.

Following that, the cryptocurrency creators work on a promotion campaign to get people invest in and purchase the currency. People who choose to participate and become investors will exchange money to purchase the project's coin or token.

The creators of cryptocurrency collect funds from investors through offering the cryptocurrency pre-ICO to purchase. During this time they generally issue coins with a lower value, often in order to get capital to continue building out the currency.

The above is, however the most basic outline. Things could be more detailed. But it should give you an idea of what an ICO is and how it works.

How to Value ICOs

IPO valuations typically reflect careful study of the company's books and financial performance. The method for valuing ICOs is differentbecause there is no underlying company with finances to scrutinize.

As such, hype and investor sentiment constitute the main foundation of ICO valuations. All crypto assets can derive their value by virtue of their function as cryptocurrencies or security or utility tokens used in specific networks or systems. It is therefore difficult to establish a financial value right in the initial stages.

The value of an ICO price based on potential uses the coin may have in the near future. This could create price appreciation. The more excited investors are then the higher the chance that the value may rise, however, this is not the case as well.

Research suggests that negative investors mood can result in negative first-day results for an ICO that may impact the performance of the currency at least six months.

If that sounds like risky, you're right. The ICO market is a highly risky investment. Scammers and scammers can easily take advantage of investors who do not have a good understanding of the crypto industry, and regulators from government are still trying to identify what their role is in the space.

How To Buy ICO Tokens in Four Steps

Looking to buy ICO tokens? Take these steps:

Step 1: Register for the ICO

The first step to buy ICO items, or even getting an early start of a new cryptocurrency an investor, is to do a little homework. That could include researching the latest and potential ICOs, and maybe even reading some white documents.

Apart from reading the white paper, you should learn all that you could about the development team who wrote it, and if it's received a lot of interest from other investors. Should the White Paper does not provide information on the code of the token or security capabilities, that's an warning sign that the token may require more due diligence.

Once you've found an ICO that you like and you're interested in participating, sign up to part in the. It might take some work but you'll be able track to a pre-ICO checklist and ICO listings on websites such as CoinDesk, ICOBench, TopICOlist.com, ICODrops.com, and CoinMarketCap.

Each ICO typically has different registration procedures. So, if there's something you're interested in, check out to understand the best way to register, and follow it as needed.

Step 2: Set Aside Funds for Payment

In the next step, you'll have to prepare yourself for when you're going to be ready to start putting money up. This involves putting money aside to facilitate the investment.

It is necessary to have fiat currency, for instance dollars, or any other crypto ready to make an exchange as required (typically either Bitcoin or Ethereum two of the largest cryptos). It is also necessary to have funds and/or crypto sitting in a digital account so that you are able to complete the transaction.

Make sure that you're registered on the proper or appropriate cryptocurrency exchange for the ICO. Some exchanges only allow investors to trade specific cryptos. You'll need to confirm that the ICO that you're after is available at the particular exchange you're working for.

Step 3: Make the Exchange

The procedure is simple Make the trade! The details here will depend on the individual ICO exchange, as well as methods.

Step 4: Receive and Store Your ICO Purchase

Ideally, following the successful completion of the transaction that your new funds are deposited directly into your cryptocurrency wallet (whichever you choose from the various types you choose) for safekeeping. Then, it's a matter just sitting back and letting the market decide the course of your new investment.

Keep in mind that ICO investments are inherently risky and there's an excellent possibility that things will turn out to be unfavourable. Because of this, it might be worthwhile take a close look at the ICO and other related news regarding the new crypto, so you can make smart decisions about when or if you should sell. The benefit of ICOs when compared with IPOs is that there is no IPO lock-up deadline that can prevent selling.