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ICO Investing: Best Practices, Tips, and Precautions!

Dec 02, 2017 Posted /  6793 Views

ICO Investing: Best Practices, Tips, and Precautions!


During the days of internet boom in the late 90s, depositors could toss money into an IPO, an ‘Initial Public Offering’ and be almost assured exceptional revenues. Several companies experienced huge first-day gains, but ended up unsatisfactory investors in the long term. But there were depositors who had the information and foresight to get in and out while making huge gains in the procedure. Even some of those savers found Amazon, eBay, and Priceline which were some of the few winners to make it out of internet boom.

1. Discovery out everything you can about the development team:

The developers of the ICO must use their real name and have an image to go along with that name. Under no conditions should you invest in a coin with an unidentified developer team?

2. Read the ANN thread on memo board:

A memo board named BitcoinTalk where people concerned in the practical details of the development of Bitcoin and other cryptocurrencies. When researching a new ICO, find the [ANN] thread of the coin and read every single page in the thread. Many main questions can often be answered in the ICO’s declaration thread. Make sure to pay special attention to questions that have been answered by the official developers.

3. Read the whitepaper:

If a cryptocurrency firm wants to raise money through an ICO, it creates a plan on a white paper which is simply called the white paper. The whitepaper conditions what the scheme is about, how much money is required to undertake the project, how much of the coins the developers will keep for themselves and how long the ICO campaign will run for.

4. Don't put all your eggs in one basket:

Just like with any other possible investment you must study to spread risk. Don't put all your eggs in one basket and invest in one coin thinking it is going to rise substantially. Find five ICO’s that you have done extensive research in and then narrow it down to the top three.

5. Be cautious and do your own extensive research:

Skepticism is a positive attribute to have in this new and exciting market. As mentioned earlier, there is always a lot of fear, uncertainty and doubt surrounding ICOs, especially online. Be careful of the information you read on message boards and do your own research.

Best Practices:

If you already know what an ICO is, feel free to move onto the next section. If this term sounds unfamiliar to you, think about it this way: Instead of raising angel funding, institutional funding, or going public, cryptocurrency and blockchain companies can now perform what is called an ICO whereby they issue a digital token that anybody in the world can purchase using cryptocurrencies like ethereum and bitcoin. If the word blockchain also sounds new to you, this video does a pretty good job at explaining it on a very basic level:

  • Discovery

  • Read the White Paper and Evaluate the Team

  • More Due Diligence

  • Purchasing Ether/Bitcoin

  • The Token Sale

The current ICO market can be likened to investing in IPO’s during the dotcom fiasco. Investors knew they could put money into the newest internet company and get guaranteed returns.

Tips for investing in ICO

While spending in an ICO does not forget to keep following things in mind.

  • Purchase in an ICO only if you see any actual world adoption.

  • Buy the token where you see some kind of income generation by the organization.

  • Purchase a token where you get some benevolent ownership right.

  • Buy a token where you see any purpose attached to the coin.

  • People are receiving scammed every day by ICO’s which are super plugged by several websites and self-proclaimed crypto leaders(bloggers/vloggers)

  • Do not get duped by paid articles.

  • Do your own study and if you find any value to the idea then go for it.


  • Most wallets and accounts you will generate will have multi-sig certification which just means that there are multiple layers of safety of your accounts.

  • Several projects have their code entirely open-source on GitHub. One caution of this is some scams are imitating companies landing pages using a diverse domain in an attempt to siphon money off to an unidentified party.

  • It is up to you to resolve if a pre-product project is value your investment. Normally speaking, in the venture capital industry, it’s seen as disrupting to increase too much money too soon.

  • If you are not observing at long-term value, be actually self-assured you know what you’re doing. There’s sufficiently of people annoying to pump and dump ICO’s or investors with years of experience day trading taking benefit of ill-advised money.

  • Expanding upon the preceding point, if you’ve done your study, don’t be worried about price swings and unpredictability. Start out small and actually understand the volatility (it's crazy).

  • As with normal spending, don’t invest more than you have enough money to lose. ICO’s can be a bizarre opportunity with unmatched revenues, but don’t make them the reason why you have to eat ramen noodles for a year.

What you think about this article cover-up, feel free to share thoughts and drop your comments in comment box.

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