There are many start-ups who have raised their funds to $5.6 Billion in 2017 according to the report published by the Business Insider. There a big boom in the projects raising funds by issuing their own cryptocurrencies. ICO marketing is attracting many investors to invest globally.
Here is the guide to participating in ICOs in 2018.
What exactly is ICO?
An ICO is a way of crowdfunding, through the release of a new token and selling it to fund the project for its development. It works on the simple principle that ICO creates a document usually called the white paper, make an informative website and explain why investors should invest in ICO. Then, it can ask the people to buy the tokens in exchange for cryptocurrencies such as Bitcoin or Ethereum. They hope that the value of the currency will rise with the time and they make the profit after investing. Before investing in ICO, check how to invest in ICO step by step.
Benefits of ICO
- Volatile Investments
Many ICOs provide you the opportunity for enough volatility to make money. There are many companies that use ICO to raise the money. You can make quick money even if you’re simply trading.
- Trade ICO Tokens
You can exchange the cryptocurrency in the market. When you join the ICO, you get the tokens that represent your shares which you can trade for the other currencies.
- Better than Forex
One of the main problems with forex is low volatility. Through ICOs you can diversify your trading and invest in the new market. This also lowers the chances of risks associated with the investment. Thus if you are looking to expand away from forex then ICO is the right market for you.
- Purchasing ICO Tokens
Many ventures raise the funds for the products even before it exists. Pick the ICO that uses well-known cryptocurrency for additional security. This way you can exchange the tokens for a third party. Thus you can avoid the scams related to ICO.
- Low Entry Barriers
With ICO, you get the opportunity to invest in the company with low entry barriers. One can invest less money than a monthly paycheck compared to IPO. In IPO, the company looks for the investors that can invest large funds.
How Can You Participate?
Step 1- Register Cryptocurrency Online
To participate in ICO, you need the cryptocurrencies such as Bitcoin or Ether that can be exchanged for ICO. If you don’t have the cryptocurrency, you should register an account and purchase the Bitcoin or Ether. You have to provide the details for the registration of ICO. Once you create an account, you can purchase Bitcoin or Ether or any other cryptocurrencies. The one you purchase will be directly sent to your online wallet. It is recommended to store the cryptocurrency in the secure software or hardware blockchain wallet.
Step 2- ICO Whitelist Registration
There is a common trend that participant needs to register for ICO whitelist before trading. To apply, you need to provide the information such as name, email, ether wallet, passport copy, etc. You also need to provide the target number of token you wish to purchase during the token sale. Usually, there is a cap for the number of tokens an investor can purchase and it cannot be more than the allocated cap.
Step 3- Key Points before Token Sales
Once you register for the ICO whitelist, you can participate in ICO tokens sale. Before participating you should know the details include in the whitepaper, token mechanism and token purchase agreement. You should also know the step by step guidelines for purchasing the tokens. Be updated with the latest trends going on in ICO. For this, you can join the community such as Slack and Telegram. There is the specific time for ICO to be opened for token sale so ensure you are having the same time zone.
Step 4- Purchase ICO Tokens
If you have decided to purchase the token sales, then you need to send the cryptocurrency from your wallet to the address stated by the ICO. You have to set the gas limit in your wallet. The gas limit is the transaction fee you have to pay when you transfer the cryptocurrency engage in an ethereum based smart network. After your successful ether transfer, you come across the several ICO scenarios depending on the mechanism
- You may get the tokens after few days of a transaction.
- You may get the tokens after the end of the tokens sale.
- Need to claim the tokens manually after the tokens sale.
In the end, no one can tell how volatile ICOs are. You should trade wisely and invest the amount that you don’t have anything to lose. Follow the above step to participate in the ICOs and stay updated with the latest news about ICO to earn the profit.