Because it may seem quite simple, investors may overlook the important points to consider before investing in the growing number of new projects (ICOs) in the cryptocurrency scene.
There are some criteria to consider in order to evaluate the cryptocurrency offering (ICO).. Violation of any of these criteria may result in significant financial losses.
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Team
Reliability is important. Who are the people behind the projects and what do their profiles look like? Remember, no matter how right a project is, if it doesn’t have the right team behind it, there’s only a limited place for it to go.
Billionaire investor Warren Buffett says she doesn’t often invest in company executives. A bright team is very important.
White paper (Whitepaper)
How critical points from logo design are expressed on white pages (documents that inform the target audience) (which should be understood simply), a clue about a team’s commitment to a project can be identified from the start.
Source of the digital currency
What is the total amount of digital currency to be produced? How much do founders and top investors dilute? What is the rate of increase? Will the founders’ coins be paid out immediately or after a while? All of these are vital issues because they can significantly affect the success of a currency. Correct answers can also increase investor confidence; Part of the reason for Ethereum’s success is that its founders have three years of experience.
Some investors also use this information to calculate their return on investment.
Roadmap
How do they plan to implement the project? The timeline should be realistic and consistent, which should be presented in well-written white papers that align with the overall plans of the project. Once they reach their initial goal, what is their next goal?
Do they have a plan for the future and adequately anticipate potential future problems? In some cases, investors tend to ignore certain aspects of startup activities.. This is likely changing as more questions are asked about ICOs and new projects are approaching with better ideas.
Use example
This is one of the most important criteria. As an investor you should ask themselves what exactly the product wants to do and its potential popularity.
No matter how good the team is, no matter how outstanding the design, if no one wants to use it, it has no token value .
An investor needs to see clearly what the project is all about. It is quite unfortunate that after the ICO some investors are still asking the most basic questions in group chats.
Contact
In most cases, how much of a project – internal and external? as – when it will communicate when fully operational is often implied by their pre-ICO communications.
Some investors complain about less communication by teams about marketing and updates after their ICO.
While some ICOs now use celebrities as part of their marketing plans, investors should be able to see if it’s just a scam.
You can invest in any ICO There are many more points that need to be investigated for. The criteria listed above are only some of the qualities that can be considered when evaluating a new project for the first time.. You will need to do much more extensive research before making your investments.
cointelegraph
Disclaimer: The information in the article is for informational purposes only.. It does not constitute any investment advice.. The author and hostagons.com/ are not responsible for your profit or loss arising from the investments you make.. Investment is ultimately based on many foundations such as knowledge, experience, research and personal decisions.