One of the beauties or the inner beauty of cryptocurrency over the FIAT currency is “Decentralization.” The wide acceptability of the cryptosystem has brought about a lot of innovation to the world we live today. The advent of the blockchain technology led to the birthing of various ICOs by several organizations. Any ICO (Initial Coin Offering) that has a perfect PR is likely to gain wide acceptability among people due to FOMO “Fear of missing out.” In the online space, there is a great need to keep safe, a lot of people are out there, that are ready to rip people off their hard earn currency. Some things need to be looked out to evaluate an ICO before delving into it.
Each ICO has unique strength and weakness and its likely that one of these will likely dethrone cryptocurrency of choice just because it has been built on bitcoin’s strengths while possessing none of its weakness.
1) Background check– One of the essential things to look out for is the history of those behind the ICO. Google has made it possible to make information readily available to us; if the people involved in the ICOs are of questionable characters, there is need to back off before losing your money to fraudsters. The team behind the ICO must show their expertise in their respective roles and have a well-proven track record. Lack of knowledge might serve as a red flag.
2) The target market must be understood– The Company, their technology and product or services rendered must align with the target market. They will inevitably be subjected to the market and regulatory pressures of their target industries, so knowing the environment should give an idea of what challenges and opportunities these ventures face.
3) Check the Whitepaper– The Whitepaper of an ICO gives you an idea of what it is all about. A well written and structured whitepaper shows that the team has done an excellent job, try as much as possible to pay attention to details like the figures and citations.
4) Are you ready to risk it- it is essential for you to know if you are prepared to risk it all for the ICO. A lot of startups are still in their incubating stage. ICO figures also aren’t reliable indicators for the venture viability; kindly make your decision wisely.