The initial coin offering (ICO) hype has become popular among investors and developers. Many people are looking for a way to get a piece of this lucrative deal. With the massive success of bitcoin, everyone is looking to invest in the next bitcoin. ICOs provide such a chance through tokenization of products or utilities. A startup sets up a crowdfunding campaign where tokens are created and sold to fund a project. However, in the recent past, many ICO scams have been reported, which makes this a highly risky investment, considering it is not backed by a real asset. ICO attorneys from IBC Group advise ICO investors to perform a thorough research before making an ICO investment decision:
Before an ICO kicks off, there is a lot of public awareness that goes on. A whitepaper contains everything you need to know about the campaign: what it does, the number of tokens created, who the developers and partners are, among others. You will be able to find the upcoming ICOs listed by some reputable websites. As long as you do your research you can also enter an ongoing ICO.
Once you find a list of ICOs, do a research on whether they are a viable investment or not. There are many bitcoin and altcoin forums to take part in. They discuss the latest ICOs and cryptocurrencies, which will help to shed more light on the issue. You can join discussions on Reddit, BitcoinTalk, CoinDesk, and CoinTelegraph, among others. The community will guide you in settling for the best ICO, based on your investment objective. You can get answers and investor views from ICO experts.
To enter into an ICO, you need to buy tokens using cryptocurrencies. In most cases, you have to buy using either ether or bitcoin. Look for a crypto exchange that offers to exchange fiat currency for coins. Create an account, deposit the fiat money, and then get your bitcoin or ether. It is worth noting that most ICOs are built on Ethereum Network. As such, you can convert your fiat money into ether for convenience when buying the tokens.
Once you have your coins, you can transfer them to your wallet. Although exchanges offer online wallets to store your digital currencies, it is advisable to have a private wallet. You are not in control of the online wallet, which puts your coins at a high risk. Create a software wallet or buy a hardware wallet to secure your private keys.
It is probably the most crucial step. You need to countercheck an address and every detail of the website every step of the way. Since you are dealing with virtual currencies and the ICO is an online campaign, confirming the addresses is critical. This will help you to avoid sending your coins to the wrong wallet or ICO address. When certain you have the right address, send the coins to receive your tokens. Always make sure that you send extra coins to cater for the transaction fee.
Once the ICO has ended, the new tokens will be listed in an exchange for trading. Depending on what kind of an investor you are, or aspire to be, you can either sell or hold the tokens in your wallet. You can track how your tokens are performing on top exchanges, such as Binance or Coinbase.