Checklist for ICO investing.
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Intro
With the great surge of token sales of Ethereum and other cryptocurrency projects there's also a great deal of misunderstanding and greed, both on the side of the companies as well as investors. How do you draw the line between good and bad projects? Follow the checklists below and you'll have to worry alot less about how sound your investment is.
Todo List
- Read the White Paper and ICO structure
- Check bitcointalk for community sentiment
- If open source, check github for active development
- Check the registration of the company and background check the names of the founders
What to look for
- Amount of coins at ICO and amount of eventual coins - If the market is flooded with coins after ICO there is no point in buying at ICO price
- Multiply the amount of coins offered by ICO price, judge if the total market cap valuation makes sense for the company/service
- Amount of coins controlled by the developers vs. offered in ICO
- Is the product already finished, actively being developed or not at all
- How does the token receive value from the service it is connected to - eg. TaaS token is a proof-of-membership to participate in the profit sharing of the closed-end investment fund
Minor technical things
- Check the security measures taken by the team for ICO funds
- Are the funds held in Escrow
- Check the wallet holders and funds on blockchain explorers
Happy investing !