What is ICO?


What is ICO?

ICO also known als crowd sale, token sale or crowdfunding is smilar to IPO, but you don’t get shares. Instead you get cryptocurrencies with the possibility to get dividends like the coin Dash does. It’s a way to raise money for your startup to be able to run this project, you are raising for. Unlike IPO it is not regulated, so the failure rate is pretty high. Some says, that on the long run only 10% of the cryptocurrencies will survive. The 1st ICO ever was in 2014, where Ethereum could raise about $2,2m. Last year was a popular year for ICOs, because there were more than 1000s new ICOs. Unfortenately about 50% of it already failed. It also happened sometimes, that those ICOs were scams, where the scammer collected the money and just ran away. That’s why in the US, EU and South Korea they plan to regulate it. China even banned it. Most recently Telegram could raise about $850b for its ICO. Some are speculating, that Amazon would do its own ICO, which would have a way bigger impact on the cryptocurrency market.

On their website you can see the team members sometimes with its advisors. From there you can have an impression, whether they might be able to push through their project. Besides there is a also a white paper describing their project more deeply with a roadmap to see their plan for the future. Most of them are based on Ethereum blockchain with ERC20 standard. To be able to take part in it, you mostly have to buy Ethereum or Bitcoin. With your Ethereum coins you will buy their cryptocurrencies. For example 1 Ethereum is worth 1000 ICO cryptos. So you don’t directly buy their cryptocurrencies with fiat money like $ or €, but you have to buy with another cryptocurrency instead.

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