Welcome to the Ask SCN Community › Forums › TH Forum › How to buy cryptocurrency before listing? Tips and tricks for ICO’s investor
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January 21, 2022 at 4:56 am #2259AnastasiaParticipant
Just this year, “blockchain” has become the hottest topic of discussion in the currency circle or the chain industry. From the initial focus on digital currencies headed by Bitcoin, to participating in the construction of the underlying technology of the blockchain, various domestic and foreign countries have appeared for a while. This kind of “chain” has attracted the attention of the government and giants from all walks of life.
For me, I mainly focus on blockchain theory and applications, including the more controversial ICO crowdfunding recently. The ICO content described in this article, I hope it will be helpful for you to participate in the ICO, and welcome to exchange opinion.
What is Initial Coin Offering (ICO)?
An ICO is a common way to raise funds for a cryptocurrency on the blockchain network project, where early participants can receive an initial generated cryptocurrency in return. Since the tokens have market value, they can be exchanged for fiat currency, thereby supporting the development cost of the project. Tokens issued by ICOs can be based on different blockchains. The common ones are based on Ethereum (ETH) and BitShares (BTS) blockchain issuance, and the blockchain provides accounting services and value consensus to achieve global issuance and circulation
Different from traditional financing methods, ICOs adopted by blockchain startups break the traditional way of raising funds for projects. The specific method is to tokenize the projects of blockchain startups, which can also be regarded as asset securitization. However, in order to avoid legal risks, we refer to ICO as an online crowdfunding method.
In this highly speculative ICO, investors are exposed to great risks. Although this may make a limited number of people rich, it will also make other risk-takers bankrupt. Like other investment methods, you must have Sufficient anti-risk ability, but also have the skills to let yourself have more effective information to make judgments, otherwise you can’t play this game.
Do you really want to participate in the ICO?
In the development of blockchain, I believe that ICO is an indispensable business model, as long as investors have enough calm and patience to grasp enough information, and rely on some professional third-party ICO platforms to provide a safe, honest, fair and transparent investment community The suggestions provided are to better screen the feasibility of the project. I believe that ICO will have a relatively healthy development. But we can’t guarantee that there is no risk behind the return, because many blockchain startups may have only one idea and nothing else, thinking of raising millions of dollars.
Some investors outside the circle hear about ICO, only to hear that it can make them get rich quickly. Usually, they don’t know much about the basic technical principles of blockchain, and they don’t know what functional properties the tokens they get can have. The only thing they know is that early investors in Bitcoin and Ethereum got rich quick, and they want to make a quick buck too.
Analyze ICOs in the same way that traditional assets are analyzed
Proper due diligence is crucial, says Gil White, head of the e-commerce and cryptocurrency division at Israeli law firm HFN:
“Investors should invest in an ICO with the same analysis as any traditional investment. The viability of a cryptocurrency depends on the analysis of the underlying project and the economics that underpin the cryptocurrency offering. Although ICO projects are based on (should) ) are based on cryptocurrencies that are innovative things, but the analysis of the project should be done according to traditional principles. Will the platform under development attract users? If not, the token has no value.”
Regardless of the type of ICO, the following five points can help you evaluate an ICO project:
1. The founding team
When investing in a blockchain project, you should first look at the project team, especially the core members. If there is a relatively strong team, both technology and marketing will be first-class, and they will be more open and aboveboard in team promotion. If the founder of a project If the team cannot share their thoughts and progress on social media like QQ groups, WeChat, forums, etc., then we will question whether their team is taking this matter seriously.
2. Project introduction
We first need to read the white paper of the blockchain project to see if they do it in detail about ICO, and if it clearly describes the project and the problems it can solve. From the model point of view, it is innovative, and there is no unrealistic boasting. If it is unrealistic, of course it does not need to be considered. From a technical point of view, there are irreplaceable core technologies or functions.
3. Financing history
There are many good blockchain start-up projects, which have been in operation for a year and a half, and even received investment from certain investors or institutions. Such projects are often more reliable, but when we want to examine this, we must also Be cautious. It is best to ask more people who are knowledgeable in the industry to inquire about its financing situation, mainly to confirm the authenticity. If all of this is found to be false, we can basically not consider investing in this project.
4. A specific and feasible plan
A specific and feasible plan must be examined. This is related to the development of the project and the key to whether your return on investment can be realized. If a project is not clear about its own development plan, let alone if it wants to make a profit, it will survive. It’s hard, we can just give up on such a project.
5. Financing objectives and released rights
A blockchain start-up project has a high valuation, and the ICO financing target is too high. If you judge that this is the case, you should invest cautiously. If financing 10 million is enough to support the initial development of the project, it has to raise 100 million, and their project team without clearly stating the purpose, we must doubt it. In fact, the founding team should consciously limit the financing ceiling. In the end, the equity ownership ratio of the founding team should be between 10-50%, which is more reasonable, preferably not more than 50%.
What is the next ICO project in 2022?
GXG recently introduced it’s Metaverse Gaming Platform which is totally building on the metaverse concept as a future gaming industry. In metaverse, a virtual reality entertainment world with gaming where people can play and socialize.
That is the new chapter for the gaming industry which is very innovative, creative and speculative. In the GXG Meta-verse Gaming Platform, players are allowed to develop games on the blockchain independently. GameFi (Gaming Finance) is created with NFT characters and hosts competitions.
GXG metaverse gaming platform is one of the new ICO project among the others, which is running pre-sale of GXG tokens. The GXG token’s pre-sale period will end after 11 days or 31st Jan 2022.
Total pre-sale amount of token is 5,000,000 GXG token, and the presale bonus is 5 %, the mining pool bonus is 45%, and the reward system fund will be 50 %. At the same time, the value of 1GXG = $0.1 (0.1 USDT) and the minimum purchase starts from 1000 GXG. For more details about the GXG new ICO project, please visit to https://gxgcoin.io/
From this, we know that the blockchain projects that carry out ICO mainly use the blockchain technology to not tamper with the property of the ledger, which can ensure the transparent and public issuance of tokens, and use smart contract technology to achieve automatic dividends. At present, the exit method of ICO is relatively simple and straightforward. As long as the blockchain project issues tokens, the tokens can be sold through online token transactions or OTC over-the-counter transactions. price to exit.(J^x2TSMvRj1COh0^)
However, blockchain projects also have other problems. On the one hand, limited by technical capabilities, some blockchain project creation teams cannot guarantee normal development or token issuance. On the other hand, token prices in transactions are easily manipulated. The strength ensures the continued development of the project, the price is not stable and the liquidity is insufficient, which will eventually lead to losses for investors.
In short, any new thing comes out, and the beginning is chaos, think about the crazy Bitcoin in 2013. While ICOs are in their turbulent early days, and many people have a lot of prejudice against it, the ICO culture may be here to stay. With the maturity and reliability of this market, ICO will become a financing method that is different from traditional investment and financing methods.
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