How to identify the best ICO for investment and trading is the topic that we are going to explain and examine today. You must also know that nowadays digital currencies and how to earn money from them have become one of the most controversial topics in the world. The field of digital currencies is growing rapidly, and according to research, there are currently more than 9,000 digital currencies in the world, and their number is increasing day by day. The strange growth of Bitcoin in the last few years is one of the main reasons that has forced many people to invest in cryptocurrencies; Especially currencies that are not known
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In fact, these people invest in some of these unknown cryptocurrencies with the potential to grow. Now, considering that digital currencies are expanding day by day, it can be a bit difficult to find the best investment opportunity. One of the best ways to invest in the cryptocurrency market is to buy the top ICOs that companies offer on the market with certain conditions to meet their financial needs. In the following, we will fully answer the question of what is an ICO and we will provide you with how to identify the best ICO.
What is an ICO?
Before we go into how to identify the best ICO for investment, it is better to know a little about ICO. In fact, ICO, abbreviated to the word Initial Coin Offerings, means initial coin offering, which is usually used by some companies to raise capital and meet their financial needs. In other words, ICO is a method of crowdfunding for blockchain projects, where a cryptocurrency, or crypto asset in general, is sold to different users at a lower price before it is released on the main market. Considering this issue, if the project is successful, it becomes a valuable investment for the buyer.
ICO can be considered a double-edged strategy, because with its help, in addition to the fact that buyers can easily profit from the cryptocurrencies they hope for and buy the currency they want at a lower price, company owners And the developers can also solve the company’s financial needs from this deal. ICO was used for the first time in 2014, with the aim of financing the Ethereum project, and over time, in 2017, it gained great popularity among users.
Read more: Reasons for the popularity of the digital currency market
Learn how to identify the best ICO
Those interested in finding the best ICO to invest in should keep in mind that the first step to identifying an ICO is research. Due to the high risk of the digital currency market, it was recommended that you research the currency you want before investing, and then take action. So far, many people have been able to achieve significant profits with the help of ICOs, and on the other hand, people were deceived without research and lost a lot of capital in this way. So it’s best to make sure you don’t get scammed before you start. To learn how to identify the best ICO, you can use the following:
Read the white paper
One of the common ways to be sure about a digital project is to read its white paper. For example, the whole world has the necessary confidence in Bitcoin and its development team, because if you read the article What is Bitcoin White Paper, you will understand that the reason is the completeness of the White Paper. In fact, by reading the white paper, you will learn about all the main concepts of the mentioned project. In other words, a white paper is a document that contains information about the concept of the project, founders, project goals, etc. To learn about the white paper, read this article. Note that to review the white paper, pay attention to information such as the following:
- The necessity and why of creating a project
- The main objectives of the project
- Technical details of the project
- Project outline
- the budget
- Project roadmap
- Project developer team and members
Check the project site
It is recommended that before investing and entering the digital currency area, especially the initial supply of coins, which is usually an unknown project, check the project’s website first. In many cases, the content of the site can help you to know the founders and goals of the project. The better design and content a website has, the better credibility it will have.
Usually, the goals in reliable projects are clearly stated, and as stated in the study section of the white paper, one of the ways to identify the project is to examine its goals. Therefore, if you are planning to invest in a project, first check the objectives of the project thoroughly. Studying the numbers, the rate of return and the promises made by the project team can be effective in identifying the best ICO.
Investigating investors and project development team
As you know, every project has a number of investors and a development team. Popularity of these people can act as a positive point for the project. For example, in the article “What is PlayDeep” you read that Samsung is one of the investors in this project, which ultimately increases people’s trust. In addition to investors, it is better to check the project development team as well, by knowing and checking their capabilities, you can start investing more easily.
Read more: Trading strategy
What are the risks of ICOs?
As mentioned in the section on how to identify the best ICO, ICOs are usually used for new projects and the impression they give people of their project can be tempting; But do not forget that the value of all currencies is not the same and investing in ICOs is high risk. It is better to look at ICOs as a coin, a 50-50 deal where you get a significant profit if the project succeeds and you may lose your entire investment if it fails.
As we have said many times in various articles, the digital currency market is a dangerous market that requires high risk-taking power, in general, the nature of this market is like this, and all methods of making money from it in this way require risk-taking power. So when a new project enters the market, it is better to prepare yourself for both ways of winning or losing; Because nothing is guaranteed in this market. In this article, we tried to explain how to identify the best ICO in simple language and talk about its risks. People who are interested in learning how to use trade strategy methods before trading, can get to know different projects better by reading this article and ultimately do better.