According to Wikipedia, the first ICO sale was held by Mastercoin in July 2013. Another
example of a successful ICO project that was profitable to early investors is the smart
contracts platform called Ethereum which has Ethers as its coin tokens. Ethereum
announced its ICO in 2014. They raised $18 million in Bitcoins at about $0.40
per Ether. After raising the money, they built the project and put it live in 2015
(more than a year later) .In 2018 (4 years later), 1 Ether now costs roughly a
whooping $900.
example of a successful ICO project that was profitable to early investors is the smart
contracts platform called Ethereum which has Ethers as its coin tokens. Ethereum
announced its ICO in 2014. They raised $18 million in Bitcoins at about $0.40
per Ether. After raising the money, they built the project and put it live in 2015
(more than a year later) .In 2018 (4 years later), 1 Ether now costs roughly a
whooping $900.
In April 2014, a team called Karmacoin went on an ICO and raised funds for its
Karmashares project. A messaging app developer called Kik went on ICO.
They issued $50 million in tokens called "Kin" totheir institutional investors before aiming
to raise more $125 million from the public. ICOs became very popular in 2017.
About 20 - 50 offerings were being issued per month. Brave browser, a new browser that
went on an ICO raised about $35m within 30 seconds!
Karmashares project. A messaging app developer called Kik went on ICO.
They issued $50 million in tokens called "Kin" totheir institutional investors before aiming
to raise more $125 million from the public. ICOs became very popular in 2017.
About 20 - 50 offerings were being issued per month. Brave browser, a new browser that
went on an ICO raised about $35m within 30 seconds!
Today, there are about 18 - 30 websites tracking ICOs. The total money raised from
ICOs in 2017 was about $2.3 billion which is more than 10 times the one raised in 2016.
ICOs in 2017 was about $2.3 billion which is more than 10 times the one raised in 2016.
Preliminary studies
- Understand ICOs and what you need it for
- Research on other ICO’s and tokens
- What to expect at each stage of the ICOWhat is an ICO?
In order to start your ICO journey, you need to first find out what an ICO is and what
you will beneeding it for.Initial Coin Offering (ICO) otherwise known asInitial Public
Coin Offering (IPCO), crypto crowdsale or crypto crowdfunding is a means or method
of soliciting for new funds in the creation of a new cryptocurrency.
you will beneeding it for.Initial Coin Offering (ICO) otherwise known asInitial Public
Coin Offering (IPCO), crypto crowdsale or crypto crowdfunding is a means or method
of soliciting for new funds in the creation of a new cryptocurrency.
It saves startups the stress of having to solicit for funds through loans, investors ,
campaigns and others. It is a new way of funding cryptocurrency projects. In the
campaigns and others. It is a new way of funding cryptocurrency projects. In the
process of raising funds, a part of the new cryptocurrency is sold at a discount to early
investors/backers of the project in exchange of the funds needed in form of legal tender or
other cryptocurrencies, most especially bitcoins.
other cryptocurrencies, most especially bitcoins.
During the course of the ICO, the new coins are purchased by the investors or
backers with fiat currency . A fiat currency is a declared legal tender either by the
government or a centralized system eg. US dollars. These sample coins are referred
to as tokens and are similar to buying shares from a startup or firm. The team organising
the ICO usually states clearly how much they intend to raise for the project from the public.
If the money raised during the ICO campaign does not meet the minimum amount of funds
needed for the project, the money is returned to the investors and the ICO is tagged ‘failed’.
If the fundsare seen to be enough for the startup, the money is used to start the scheme or
complete it.
backers with fiat currency . A fiat currency is a declared legal tender either by the
government or a centralized system eg. US dollars. These sample coins are referred
to as tokens and are similar to buying shares from a startup or firm. The team organising
the ICO usually states clearly how much they intend to raise for the project from the public.
If the money raised during the ICO campaign does not meet the minimum amount of funds
needed for the project, the money is returned to the investors and the ICO is tagged ‘failed’.
If the fundsare seen to be enough for the startup, the money is used to start the scheme or
complete it.
Important questions to ask about your cryptocurrency:
In choosing an ICO, the following is important
- How does the token and network attached to it function together.?
- What is the problem the new currency is trying to solve?
- What is the structure of the token?
This question will be answered in depth further down. ICOs can be used for a wide range
of activities ranging from corporate finance, fundraising and even fraud.
of activities ranging from corporate finance, fundraising and even fraud.
Types of cryptocurrencies:
There are two main types of cryptocurrencies from a regulatory point of view:
- Utility tokens:
Utility tokens comes from the value which should enable the holders to exchange the
token for a
token for a
service, such as a Bitcoin or ether. If the token will be used by the users to purchase
items or services inside the platform being built by the ICO team, it is a utility token.
Eg. Imagine an ICO that is building a game in which the users will use the token to
purchase items in the game.
items or services inside the platform being built by the ICO team, it is a utility token.
Eg. Imagine an ICO that is building a game in which the users will use the token to
purchase items in the game.
- Asset-backed tokens:
For an asset-backed token, its value comes from the underlying assets which
the token can give to its holder. These are tokens backed by assets such as houses,
land, gold, oil etc It offers some sense of security to its investors who know that if the
ICO fails, their money won't just vanish into thin air.
the token can give to its holder. These are tokens backed by assets such as houses,
land, gold, oil etc It offers some sense of security to its investors who know that if the
ICO fails, their money won't just vanish into thin air.
Research on other ICOs
The next step would be to come up with an idea of a problem you would like to solve
using the blockchain related technology. Once you come up with the idea, you need
to figure out what field or category your solution falls into, then research about other
similar ICOs in that field. Go for the best ICOs in that field and find out how they
approached their ICO, organised their team and solved every other problem. For
instance,if you wanted to build a blockchain that would help people build their own
blockchain based apps , you may want to do a research on other existing blockchains
in that field that went on successful ICOs such as Ethereum, NEO, Stellar etc
using the blockchain related technology. Once you come up with the idea, you need
to figure out what field or category your solution falls into, then research about other
similar ICOs in that field. Go for the best ICOs in that field and find out how they
approached their ICO, organised their team and solved every other problem. For
instance,if you wanted to build a blockchain that would help people build their own
blockchain based apps , you may want to do a research on other existing blockchains
in that field that went on successful ICOs such as Ethereum, NEO, Stellar etc
Make a list of what to expect
You need to make a list of what to expect at each stage of your ICO
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