Essential-must-have elements of any successful ICO

I’ve prepared a simple list with the things that you have to do and how to do them in order to create a successful ICO. I focus on the things that you must avoid to guarantee success:

Always, always, always be transparent and honest Tell your own story Listen to the community and create something that they need Avoid variable token prices for the pre-ICO and early investors Limit the amount of tokens each investor can buy Set gas limits to avoid prioritizing the richest Help people understand how they must proceed to participate in the ICO Audit all of your Smart Contracts and create Bug Bounties Fix errors the elegant way (without pissing off your investors)

Always, always, always be transparent and honest

The worst thing that you can do in your ICO and any project is to not be entirely honest. People will ask questions and the will want to know the truth.

So if you set a minimum funding goal of 10 million dollars for your project, it must be justified. At least give an explanation of where the money will be used and why.

The more information you provide the better. Don’t hide anything unless it’s too personal.

Some startups like distric0x are 100% transparent. They show how all the money is being used, they update their community with articles about how the development is going. The are clear with their intentions.

I believe that’s the best way of interacting with your people. They will want to be updated constantly as much as possible about how your development is going on.

That’s why I recommend you to use twitter, reddit, facebook, medium, slack anad telegram to update your community about how things are unveiling.

Choose one communication channel and stick to it. It’s the best way to keep people informed.

Tell your own story

There are ICOs that try to be anonymous by hiding the people behind the project. That may work but it’s always better to put your face out there.

Tell your story. Create an “About Us” section on your website to tell people how did you started in the Blockchain ecosystem, your beginning, your mistakes, everything. This creates a ton of trust.

Don’t try to hide essential details like your education, your experience and your past projects. Those are key elements to understand your capabilities as a team leader.

Listen to the community and create something that they need

If 10 users out of 100 are telling you constantly that the UI must be simplified, they are probably right. Even if only one user is providing useful feedback, you must listen to him.

Because you never know what key problems your customers are experiencing that you’ll be able to solve with your product, with your ICO.

Also create something that people need. Don’t start another blockchain from scratch unless you’re adding value to the community. We don’t need another litecoin or dogecoin.

Get useful feedback as soon as possible. Create an article with your idea and see how people respond. You’ll have to invest a significant amount of efford before even starting to get your idea right.

This includes creating a quick prototype with the essentials and sharing it everywhere to see if people are really interested in the idea.

Create your whitepaper as soon as you have the idea. People will read it and some of them will help your improve it.

Create a simple website showing your idea and collect emails from interested users. Spend some money on advertising and see how they respond. If nobody is excited about the idea, it’s probably because you need to explaing the positive points better in your whitepaper.

Avoid variable token prices for the pre-ICO and early investors

One of the many details of a trustworthy ICO is the fact that price-per-token is always the same.

Most of the ICOs decide to sell their tokens to a smaller price for the earliest investors. That’s not the best way to approach your ICO since people will see your intentions and they will think that you’re in the business to raise money instead of creating a useful product.

Set a fixed price and fixed supply. It’s the best way to show people that you value all your contributors the same independently of when they participate in the ICO.

It’s quite obvious if you see it from the perspective of the investor. You’d get pissed off if you have to pay double for the same tokens because you came later to the ICO.

Likewise, sell all your tokens to the general public instead of giving a lot of them to advisors or to a selected group of people.

Try to be as honest as possible by providing the same opportunities to all the interested contributors. That’s why I don’t recommend to do pre-ICOs with cheaper token prices unless it’s justified.

Don’t limit the ICO participation to a whitelisted group of people because you’d be closing doors to interested contributors that discovered your ICO later. Unless, of course, you need to do it for legal reasons.

Get legal advice before the crowdsale.

Limit the amount of tokens each investor can buy

There are people with lots of monetary resources that will want to get as many tokens as they can for themselves. This wouldn’t be bad if the ICO were a closed process.

But because the ICO is intended to be open to any user, your moral obligation is to limit the amount of tokens each person will be able to get. There’s no best way of limiting the amount of tokens per user.

However one of my favorites ways is to limit the amount of tokens each ethereum address is allowed to buy in the ICO Smart Contract.

Simply log how many tokens each address is getting and block those that exceed the limit to leave tokens for other users.

If you don’t do this, you’ll be at risk of breaking the trust of your community like Decentraland did. They didn’t limit the amount of tokens each user could get in the ICO and a very small amount of whales got the majority of the tokens sold leaving thousands of users without tokens.

Set gas limits to avoid prioritizing the richest

For the same reason as before, set gas price limits in your ICO smart contract.

The way Ethereum transactions work is that you set the gas price of the transactions manually. The miners will then prioritize the most expensive transactions to be processed first.

This way the people that want to get more tokens will set a large gas price to get the tokens earlier, limiting the chances of participating in the ICO to the smallest investors.

Just set a gas limit in the ICO Smart Contract by reading the value of tx.gasprice and rejecting the transactions that exceed a fixed gas price limit.

Help people understand how they must proceed to participate in the ICO

A big chunk of investors in the ICO won’t know how to participate because each ICO is different.

Some of them allow BTC participation, some of them allow credit card payment and the majority only allow Ether as the payment for tokens because it’s the fastest way to get them.

That’s why it’s essential to create video tutorials to show people how to participate in the ICO with each different wallet. Create blog articles to explain the process.

I’ve seen startups that don’t clearly show people what they have to do to participate in the ICO. If you don’t you’re at ristk of losing a lot of investors.

Audit all of your Smart Contracts and create Bug Bounties

There have been a lot of Smart Contract bugs and vulnerabilities that lost millions of dollars just because the developers didn’t bother to request a professional audit to find vulnerabilities and bugs.

A Smart Contract audit for your ICO is not only essential but neccessary nowadays. It will help you find potential bugs that malicious actors could take advantage of.

Once you deploy your Smart Contract it will be there forever and you won’t be able to modify it. So all you can do is prepare with security audits to finds the possible problems before it’s irreversible.

If you deploy your code without testing, auditing and several checks, you’re risking millions of potential dollars from your investors. This is bad legally and personally.

You may think that your code is simple and secure but you never know what could really happen in extreme situations.

That’s why I recommend all the ICOs to request a professional audit. I do audits myself, but you can just go to Open Zeppelin or New Alchemy to request a professional audit if you don’t trust me enough.

In fact, I’ve written a ultimate guide to audit Smart Contracts if you want to know more about the process here: https://medium.com/p/ae402a7e7868

On the other hand is also essential to create bug bounties. A bug bounty is a process where you make your Smart Contract code public and reward people for finding bugs, vulnerabilites and improving the code.

The bigger the vulnerability, the bigger the payment. You set the rules yourself freely and with honesty.

Simply go to a subreddit such as /r/ethdev or /r/ethereum and post your code with the intention of finding problems on it. People will openly participate and will really help you understand the issues of your Smart Contracts.

For instance you could write something like this:

This is the bug bounty of <company>. We will reward users from 1 ETH to 40 ETH depending on the severity of the vulnerabilities found in our ICO and ERC20 Token Smart Contracts. You can find the Smart Contract code in our github here: <link> We'll reward users the following way:

40 ETH bug bounty for bugs that enable stealing user funds. 20 ETH bug bounty for bugs that enable stealing the bounty or that lock user funds. 2 ETH bug bounty for smaller bugs like avoiding the fee or causing the "buy" function to be uncallable. We'll show the rewarded people publicly once the changes have been made to the Smart Contracts.

Remember to always reward people in ETH or BTC, not in your own token because it creates a really bad impression of not wanting to spend real money. It’s like printing your own money without knowing if your token will be tradable and exchangable for other currencies.

I’ve seen lots of bounties that reward with some unknown token before the ICO which is totally frustrating since you’re not paying people for their time and efford fairly.

It’s already a big efford to analyze a Smart Contract so the few people that know enough about Ethereum programming and code vulnerabilities risk their time for the slim chance of finding a security issue.

So reward generously to those that are saving you potentially millions in the bug bounties.

Fix errors the elegant way (without pissing off your investors)

It’s a fact that your ICO will have some kind of error or confusing situation. It’s your job to remain calm and show people what they have to do to fix the issue.

I’ve been working in ICOs where the owners got totally crazy and nervous whenever there were some sort of issue with the ICO process. Don’t be like them and keep it cool.

Talk to your people individually and help them solve the issue. Be prepared to act fast in unexpected situations. Prepare for the worst.

You have to simulate fake ICOs before the real one to see how you’re team will react. Improve the process as much as possible and be in control of everything.

Remain humble and honest at all times whenever the transactions are not being processed or whenever some investors are getting angry.

Conclusion

To get the necessary trust to run a successful crowdsale, you need to rememeber these points:

Always, always, always be transparent and honest Tell your own story Listen to the community and create something that they need Avoid variable token prices for the pre-ICO and early investors Limit the amount of tokens each investor can buy Set gas limits to avoid prioritizing the richest Help people understand how they must proceed to participate in the ICO Audit all of your Smart Contracts and create Bug Bounties Fix errors the elegant way (without pissing off your investors)

Now that you read the entire article, you’re more than ready to create a successful ICO from scrath the right way. Thanks for reading it entirely and be sure to leave those clap-likes on the right panel and comment any questions you may have.

Did you run and ICO? Do you plan to raise funds using the Ethereum blockchain? What kind of funny, interesting stories do you have related to ICOs and cryptocurrencies? We’ll love to hear more about you. So make sure to leave a comment down below.

Be ready to work hard and with honesty at all times to reach your hard cap.

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I’ve worked for more than 4 ICOs and I’m available for any project related with Ethereum including:

Smart Contract programming: I can create all kinds of Smart Contracts, ERC20 tokens and ICO Smart Contracts to sell your tokens.

I can create all kinds of Smart Contracts, ERC20 tokens and ICO Smart Contracts to sell your tokens. Smart Contract auditing: I can help you secure your Smart Contract programs with a professional audit where you will increase the trust of your ICO with secure code.

I can help you secure your Smart Contract programs with a professional audit where you will increase the trust of your ICO with secure code. Token Airdrops: If you want to airdrop your tokens to a big number of addresses, just send me an email to merunasgrincalaitis@gmail.com and I’ll help you do the token Airdrop.

If you want to airdrop your tokens to a big number of addresses, just send me an email to merunasgrincalaitis@gmail.com and I’ll help you do the token Airdrop. Dapp creation: I’m a fullstack javascript programmer and solidity expert so I can really help you create all kinds of decentralized applications that communicate with the Ethereum blockchain.

I’m a fullstack javascript programmer and solidity expert so I can really help you create all kinds of decentralized applications that communicate with the Ethereum blockchain. Consulting and advisoring: If you need help in running a successful ICO, I can really give you personalized advice to reach your goals faster.

If you need help in running a successful ICO, I can really give you personalized advice to reach your goals faster. Anything related to Ethereum: I’m a quite active Ethereum member so I’m always intersted in new challenges and opportunities. I live in Spain so the timezone difference must be considered.

Here’re my best articles:

The ultimate end-to-end tutorial to create and deploy a fully decentralized Dapp in ethereum

What it takes to create a successful ICO? How expensive it is? Your complete guide

The ultimate guide to audit a Smart Contract + Most dangerous attacks in Solidity