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Initial Coin Offerings (ICOs) is akin to offering shares to crowdfund cryptocurrency based project. Visit our site: www.platinumtradinginstitute.com/
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CRYPTOCURRENCY What are Initial Coin Offerings (ICO’s)?
Initial Coin Offerings (ICO’s) • Initial Coin Offerings (ICOs) is akin to offering shares to crowdfund a Blockchain or cryptocurrency based project. • At Platinum Trading Institute (PTI), we are excited to offer this primer on ICO Investment, fundamentals.
IPOs versus ICOs. Compared with Initial Public Offerings (IPOS), ICOs differ from IPOs in many respects. • IPOs are not truly Crowd Funding mechanisms. • ICO Investment is TRUE crowdfunding mechanisms. • IPOs are issued for an existing technology, product, or an idea. For example, say an APPLE device was developed and sold using private investors’ funds before it was ever sold to the public. The pre-existence of technology is thus less risky and breeds confidence among investors. ICOs are issued prior to the technology or the product being developed. Thus, they are riskier and often investors have to rely on the promise of the underlying technology for making ICO investment decisions.
Is ICO Investment Legal? • The legality of ICO Investment is still an open question. They are new and still unregulated financial instruments. In addition, they do not follow any traditional pathways for generation, sale, and dissemination among the investors. • However, SEC has recently issued a series of opinions that lead to its acceptance by the traditional investment communities. For example, some applications of these tokens are just only that – they are utility tokens – and used for a specific use. Some of the gaming tokens fall under that category. • On the other hand, some of the reputed ICOs allow the purchaser to own them for some future gain in their values. In that case, these tokens are viewed as an investment or a security – for example, Ripple or Ethereum.
How are ICOs Priced and Issued? • Recall that ICOs are the mechanisms to crowdfund a given project, contract, or a product. • Thus, an inventor or an entrepreneur sets up a protocol or a Blockchain for the product that he envisions to launch. • Once the Blockchain is established, his next step is to mine coins in support of that product or the contract. • At a given point in this mining process, the miner names the coin and establishes its initial offering price. This could be $0.10 or $1.00 – at the discretion of the miner. In addition, the miner can offer a low price to initial investors – increasing it gradually for later investors. • The next step is to facilitate its sale and dissemination. A coin can be offered for weeks or a month, though there have been instances where initial offering has been exhausted in a matter of minutes raising hundreds of Millions of dollars. • The ICO issuer also resorts to social media outlets, his own website, and other digital marketing approaches to make Initial Coin Offering more accessible to the public.
How to Make ICO Investment Decisions? Just like any other ICO Investment decision – a due diligence of a given ICO product is almost a must. Thus, researching an ICO is a critical element prior to investing in any offering. There are several ways to research a given ICO. • Evaluate Top ICO list, • Follow ICO watch lists as advertised by major exchanges, • Acceptance by a major exchange, and finally • We, the Platinum Trading Institute (PTI) experts invite you to subscribe to our Cryptonnaire weekly.
THANK YOU. If you want to stay on the top of the crypto technologies, innovative trading strategies, or simply like to be financially successful, please sign up for a two-day course on cryptocurrency trading.
