An ICO; Initial Coin Offering is a fundraising process; where new projects sell out their fundamental tokens in exchange for main cryto’s such as Bitcoin and Ethereum or cash. Back in 2013, countless projects used the crowdsale model in an attempt to fund their projects until the early 2014; where ETH was successful in raising over $18 million. In other words, an ICO is certainly very similar to an IPO but the only difference is that instead of selling shares of the organization, the startups use ICOs to sell crypto-coins in exchange of money.

Before making an invest to any sort of ICO; here are some tips for you to be able to invest in the right projects:

Examine and assess the project’s whitepaper: Before making any sort of contribution into any project; you need to review the whitepaper and examine the feasibility. To remind you what the whitepaper is all about; it’s a handbook instructing the readers about multiple issues/or issue and offering an idea about how to resolve them. The document should include the following informations; problem itself and a detailed information on how to solve that, detailed description of the product as well as the system architecture, detailed information about the team behind the project, extensive information about the ICO itself. The readiness of the project’s MVP: The Minimum Viable Product is the reduced version of a product which can be released and possesses three key features; has adequate value for the people who are willing to use it/buy it, establishes sufficient amount of future benefits to retain early adopters and offers a feedback loop in order to direct for future developments. Comparison of the ICO to its potential competitors: In-depth analysis of competitors should be done to see if there are alike products or resolutions in the marketplace. If you find similar products, you should inspect prominent features of the project which can be more outstanding and promising compared to the other ICO. Analysis of all the advantages and disadvantages: Do not make any sort of investment unless you go through all the advantages and the disadvantages of the project; the current and the future requirements and the likelihood of the general project to be successful Crypto Investment Sentiment: You can find useful insight regarding the investors’ experiences and recommendations. You need to look carefully at the general and specific crypto trends as well as the products by following the discussion threads through different platforms.

There are more detailed factors you should be looking at when you are planning to make an investment into an ICO but the aforementioned are the main factors to keep an eye on. Bare in mind that in the blockchain industry there are countless scams and investing into a real project and real people is actually the step one of not throwing your money down the drain. Moreover, the more transparent and open the project is to the community, more likely for them to be suitable.