“What are the criteria you look at before investing in an ICO?” is one of the most asked questions of cryptocurrency investors to me.
Instead of answering everyone seperately and still not making myself clear, I decided to make a video about it.

———————————————————————————————————————————————————–

Follow me on Twitter:

Follow me on Steemit:
https://steemit.com/@younginvesting

Follow me on Facebook:
https://www.facebook.com/YoungAndInvesting1

Cryptocurrency investing Facebook group: https://www.facebook.com/groups/480785485606417

———————————————————————————————————————————————————–

If you’re feeling generous, donate to me here:

Bitcoin: 3ENm2XRVACaaEEwRqMZNYt9Zf1K1yWicUX
Ethereum (& ERC 20 tokens): 0x8cb2838f3F5e43FCCeEF696D3570D3762968F118
Ripple: rDsbeomae4FXwgQTJp9Rs64Qg9vDiTCdBv
Litecoin: MB9Z1bZHf72qNa3439nDoEcdHdUWMAshbq
Dash: XrucvJa2F3GLfqn3h8MQPww16i9rHN5Lae
NEO: APPViiDBuQn8NcKqgzX31jQ2ySaP2kW47L

source

8 COMMENTS

  1. I would add at least few more criteria:
    1. The hype factor – it's extremely important for the token liquidity later on, as well as for the demand on exchanges, so if your intention is to flip the token this may be your most important criteria. Sometimes really crappy projects are getting a lot of hype, which doesn't really matter for flipping.
    2. The First Mover Advantage (FMA), which you briefly touched on when talking about competition. This is about the "uniqueness" of the idea and being first with this idea to the ICO market.
    3. Total supply of the tokens: the lower the better for the future prospects of the price appreciation.
    4. "Reality check" criteria – if somebody is telling us that they are working on a new revolutionary Internet search engine which is supposed to compete with Google we definitely need to think twice before deciding if this has any chances at all for materializing. Just an example of course. So, the idea may be really revolutionary, but what are the chances for its implementation?
    5. "Greed factor" – percentage of the tokens reserved for the team and advisers – this is pretty important, because if an ICO sells only 30% of their tokens to the public and reserves the rest for themselves it's pretty obvious that they may easily manipulate supply and demand, so the price of the token won't be set by the free market.
    6. Initial discount during pre-ICO stage – some of the ICOs give 400% discount for early investors, which multiplies your chances for better ROI later on, no matter if you want to flip, or hold it.
    7. Strong community factor – it's extremely important for any idea to be successful to have a strong community of backers, so I always check for example the number of posts on Telegram group for a new ICO, but also on Bitcointalk, on Reddit, Slack, etc.
    8. Project documentation – we all have probably seen very crappy one page explanations of a very sophisticated projects, as well as a long and very detailed white papers covering all minute aspects of some other projects, so this is pretty self explanatory.

    The regulatory compliance criteria brought up below by G Tirado is tricky, because obviously it all depends on the country, so there may be different laws both for issuing a new ICO and its compliance, as well as for investing in that ICO. Of course we should stay on a safe side and not invest in anything, which is clearly against international law, right?

  2. I think Regulatory Compliance is very important as well. Have them hurdles been cleared across the countries you wanna bring this UseCase to. You can have a great concept but it may not pass the mustard with some governments. I believe LA Token has met some road blocks with the SEC. AS well as TenX has issues with the Visa company in bringing a debit and/or credit card to market in the U.S.

LEAVE A REPLY

Please enter your comment!
Please enter your name here