5 Things to know about ICOs before you invest in them
Initial Coin Offerings (ICOs) acquired high popularity during 2017 and 2018. While multiple ICOs collectively raised nearly $7 billion in 2017 alone, the total funds raised by ICOs in 2018 was double of that amount.
In short, what we are trying to say is that ICOs are now quite popular among the investors as a promising and high-profit investment tool.
But there is still a big red flag of trust that makes potential investors worried about ICOs. Since ICOs and cryptocurrencies are still unregulated or unaccepted by many governments, relying on them as an investment option is not something every investor is comfortable with.
Are you also planning to invest in the ICOs this year?
Here are the five things you should know before investing in an Initial Coin Offering.
ICOs are not Exclusive
First thing you must know about ICOs is that they are not exclusive to any particular company, team, investor group or audience. Anyone and everyone can use the ICO method for raising funds for their new company, project or product. The only prerequisite to conducting an ICO sale is that you must have a team who knows how to create and launch a token.
Tokens have different types
The token is the general term used for referring the cryptocurrencies launched and sold by companies during an ICO sale. If you are thinking of investing in an ICO, you must be aware of the different types of tokens and their significance. Utility tokens are the most common types of currencies used by ICOs, as they give access to a particular utility in the company/project. Other types of token include security tokens, asset-backed tokens, native tokens, etc.
ICOs are prone to fraud/spam
While ICOs are backed by blockchain project, it doesn’t necessarily guarantee that the particular ICO will be safe and free of any kind of spam. In fact, a large number of the total token sales being held today are a fraud. The good thing is that there exist red flags which you can consider to identify a bad ICO. These include lack of publicity, an unprofessional website, team not disclosed, poor quality whitepaper, etc.
ICOs are still struggling with regulation
Like I said before, not every country and government is positive when it comes to investing in the ICOs. So, you should consider that as well before you plan to invest in one.
There are good ICOs out there
From my own personal experience in the industry, what I’ve realized is that there are also many good ICOs who are actually trying to do something genuine, finding a solution to a real problem and creating profits for the investors. However, finding them out of the jumble of bad ICOs is something that requires patience and a lot of research.
Pieta is one such ICO. Pieta is a cryptocurrency based on ERC20 standard of Ethereum. The Pieta coin is the native coin of the Pieta ecosystem, which is a mining platform being developed to be powered by solar energy.
Originally published on Pieta Ecosystem