What is a Crypto Currency ICO? |
Posted: February 25, 2018 |
It has been called the modern gold rush, but what exactly is an ICO and is it worth investing in? To find out more about Crypto Currency ICOs read on, and we’ll explain what all the fuss is about. What is an Initial Coin Offering (ICO)? The hottest trend in the world of cryptocurrency right now is, without a doubt, the initial coin offering (ICO). The idea of an ICO is very simple, it’s an initial offering a new crypto currency in return for traditional funds, or other crypto currencies, such as Bitcoin. An ICO is very much like the initial capital fund raising for any new business venture. A new crypto currency business will offer a certain percentage of their crypto coins or crypto tokens to investors and early adopters as a means of raising capital. The offering is usually backed up by a white paper that explains what the venture is all about, how much money is needed to get the project off the ground, what types of money will be accepted in exchange for the new crypto coins, and how long the ICO opportunity will be open for. You can see some examples of the information provided for ICOs at https://topratedicos.io. An ICO is usually run very much like a traditional initial public offering (IPO), where shares would be offered in return for an initial investment in a start-up company. As would be the case with an IPO, if sufficient funds are not raised with the given timeframe, the ICO will be deemed to have been unsuccessful, the project will be cancelled, and the funds that have been raised will be returned to the investors. What’s the motivation for investing an ICO? The motivation for investors in ICOs is the hope that the crypto coins that they receive from the initial offer will rise in value once the crypto currency has been launched. One example of a very successful ICO was the platform called Ethereum, which is a contacts platform that uses tokens called Ethers. The Ethereum ICO raised $18 million worth of Bitcoin when the Ether was valued at $0.40 in 2014. By the year 2016, the Ether was worth $14, and Ethereum had a market capitalization of more than $1 billion. Is it legal? Currently, the ICO market is unregulated in most countries, but it is perfectly legal. ICO’s exist in a slightly gray area of regulation, which is why they are often likened to crowd funding rather than to IPOs. The crypto currency, market is, however, attracting a lot of attention, so it is likely that at some time in the future ICOs will become regulated. Where do you find out about initial coin offerings? Just as with any type of investment opportunity, not all ICOs are going to provide phenomenal returns, and there have been a few disastrous collapses of crypto coin initial offerings too. The best way to learn about the latest ICO’s and be able to assess them is to visit an independent review site, such as https://topratedicos.io/ico-reviews/. Sites like this provide all the information about the latest top rated ICO’s, and they give their opinion on each offering and they rate them.
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