There are a ton of ICOs out there, with every single one of them promising huge returns and useful perks for potential investors. But before you get carried away and start sending your hard earned money to every single project out there, remember that many, if not most of those projects will inevitably fail or will turn out to be a scam.
Keep in mind that all cryptocurrencies and the Ethereum platform, in general, is basically an experimental technology. A vast majority of ICOs are reliant on Ethereum, and they themselves are a very experimental mechanism. It’s an experiment on top of an experiment.
A typical project holding an ICO will have a website and a white paper, containing as much information about the project and its goals as possible. Those will describe the team and its relevant experience, the idea and the roadmap of its execution, approximate goals and means of reaching them, and so forth.
Always make sure that an ICO has a wide and, most importantly, open supporting community. A public Slack or Telegram chat for all investors is generally a very good sign. Other sources like Facebook, Twitter or Reddit, can be extremely handy when evaluating an ICO as well.
Keep an eye out for so-called bounty posts and threads. It is a very common practice to ask people to spread positive information about the project for certain rewards to increase both media and the community attention towards the projects. Bounty posts don’t necessarily mean that an ICO is a scam, but a promising project with experienced team members and a decent promotional campaign won’t need to rely on such tactics.
There is no universal rule about what stage of development should the project be at before it can hold an ICO. At times, there will only be a white paper and a rough roadmap. Sometimes, there will be a beta version of a product or even a launched product, perhaps with limited functionality.
Of course, it’s always safer to invest in projects that are as close to the launch of a fully-functioning product as possible. As a general rule, investors tend to prioritize projects with at least some lines of working code. That being said, there have been many instances of ICOs becoming a success with no code being written whatsoever.