It is becoming increasingly difficult to run an ICO, and to participate successfully. In the beginning, all a company had to do was make an announcement. Provided they had a good product in the works and promising team, there would be and endless number of people from around the world ready to give their money towards a project and speculate on the value of it's tokens.
In 2017 the interest in investing in ICOs grew exponentially. The number of ICOs also grew and with them the number of scams and scammers ready to trick people out of their contributions.
It used to be easy to identify a good ICO, now it requires serious work. It's not enough to read the white paper and be satisfied that the idea and plans "look good" or will be "disruptive" to it's target industry. We now have to research the teams extensively, check on their code on Github (or find a useful Youtuber that know how to check code, or read messages on reddit), join the telegram group to get a feel for the team/company. You may also want to check in on the AMA (ask me anything) event with the CEO to find out if that guy really has a vision. Oh!... and do they have a working product yet?
The work to find the good ones is no longer an activity for an hour or so at the end of the day, it's a full time job. It's exhausting. Once you find the right one you also need to be vigilant, make sure you're getting your information from the official channels only. Scammers are rampart!! And you may also spend some time blocking scammers that try to get in touch with you on Telegram!
It's muddy waters out there! For the ICO companies and the investors.
With regulators beginning to hover in the crypto space, KYC processing has become the new normal. Proof of identity is now a requirement to participate in an ICO. Some ICOs go as far as requiring proof of address in order to be approved to participate.
ICOs are also stepping up their whitelisting processes. The good ICOs get oversubscribed very quickly, and they look for ways to make participation fair while avoiding gas wars. Limits are quickly becoming the new norm in ICOs. The crypto whales are understandably upset by this, some opting not to participate in ICOs, instead they wait and buy the tokens when they enter exchanges and get dumped by weak hands. The Telegram groups can get quite comical. But please don't spend too much time in there. Ask questions, get your answers and stick to the announcement channels, or you'll simply waste a lot of time going through messages about mooning and lambos!
We are starting to see ICOs add extra steps to their KYC processes in order to manage the number of subscribers and investors at the TGE. The Seele ICO is the first one I've seen to give a quiz during their whitelisting process for their ICO. They asked questions, it would seem, to determine what kind on investor you are? Do you understand what the project is about and what they're trying to achieve, or are you just following the hype and looking for moon + lambo?
Last week we had a surprise announcement from Ontology which was due to hold it's ICO on the NEO platform. They decided they would simply give away their tokens instead. They surprised everyone by cancelling their ICO and air-dropping the ONT tokens to the whitelisted participants and NEO holders.
We then have NEX, the most anticipated ICO of the year so far. The NeonExchange ICO that opened their whitelisting this week on Monday has opted for a lottery system. If you desire to participate you first register your NEO wallet address for the lottery. They will only select 25,000 people. If you get selected, you will then be asked to submit your KYC information. They are clearly more interested in having a fair, unbiased and efficient process. Saves them the task of going through more KYC submissions than necessary too I suppose.
The Metronome ICO is expected to start end of march sometime, and they are not doing a whitelist. Even participants from countries that have banned ICOs can participate! How you ask? Well, It's not an ICO in the usual sense, they're holding a descending price auction. You can read all about it here on their post
One thing is for sure, there is no one way to hold an ICO anymore, there is no standard. We can expect companies to come up with all sorts of hurdles for investors to jump through in order to minimise their work, as well as to secure the process better than it has been in the past. I for one will be glad for the processes that mean better security.
What about you? notice any interesting ICO processes? what are your thoughts on the progression,...
-pinkdust
my places
--Trade alt coins! Join Binance.com
---BUY BTC/ETH with visa/mastercard
----CEX exchange load account directly with visa/mastercard + withdraw with a chargeback
-----Get fiat without cashing out your crypto
ICO clipart from www.istockphoto.com
This is not financial advice.