ICOs are considered as a way of investing in a token or coin from the very beginning to maximize profits all the way. Investors are usually excited at the possibility that they can purchase tokens at a meager price and sell when the value is significantly higher.
The total amount of dollars that have been invested in ICOs stood at over $1.2 billion as of July 2017. Before we proceed, you first need to understand what an ICO means and the purpose it serves.
What is ICO?
ICO is an acronym for Initial Coin Offering. It is a means of raising funds for a particular project in a sector. On several digital asset exchanges, there are more than a thousand coins that have been listed already. However, with the emergence of several new cryptocurrencies through ICOs, tens of tokens are being listed each day. What you need to understand is that several of these tokens don’t have their own blockchain. They choose other blockchain platforms to build their tokens on.
A good instance of this are ERC20-based tokens which are built on the Ethereum blockchain. Ethereum’s blockchain allows the creation of several tokens. ERC20 tokens remain popular in the ICO space.
How to Invest in the Right ICOs
1. Find a Website on Which Upcoming ICOs are Listed on
Once you can have a list of ICOs, you can determine which one will be best for you to invest in. This is because, on these websites, the ICOs are listed with their features, their mission and vision, team, token distribution, funds allocation, and others. You can also find whitelist ICOs which require you to register ahead of the start of the ICOs.
You can also go on to forums that discuss ICOs. They include subreddits on Reddit or BitcoinTalk. You’ll find ICOs that drive the most buzz depending on the people behind the project or backing the project.
2. Research on the ICOs Listed
Since you’re investing your money, you’ll want to go with the ICO has a great vision and is bound to get you the highest amount of ROI. Every ICO has its whitepaper in which it summarizes everything about the project it’s developing through its fundraising. You need to look at the reviews that have been done by others on the project. On forums like Reddit, you can find extensive reviews on particular ICOs done by investors or potential investors.
3. Participate in the ICO
After choosing the ICO you want to participate in, you’ll need to buy some Bitcoin or Ethereum. Most ICOs require either of the two coins to purchase their tokens. You’ll also need to create a wallet where you can receive the tokens. Some ICOs need you to create wallets on their websites. ICOs with tokens that are ERC20 based require you to create an Ethereum wallet. The best and most popularly used wallet for this is MyEtherWallet (MEW).
There are particular ICOs that guide you on how to invest in their ICOs. To receive updates on changes to the roadmap of the ICO, you can join their Telegram groups. Most ICOs have their own Telegram communities where people can discuss.