The Not to do when investing in Crowd funding or Initial Coin Offering (ICO)
In his book Good to Great, Jim Collins said the not to do list is as important as to do list if not more important. It is not a surprise that out of the Ten Commandments given to the Israelites seven out of it are “Do Not …”
Looking at the recent DAO fiasco one needs to think twice before investing in a project with due diligence.
This year Ethereum success has given investors a good feeling about investing in ICO, if you invest 1bitcoin 24 months ago in Ethereum would have multiply your investment 50x, I mean you will be holding 50 BTC in your wallet. This dream reward has made ICO a new way of making quick cash, but no risk without reward.
Looking at the recent ICO project Lisk, Waves, and The DAO.
Lisk had a successful ICO, raising $6 million, but the launch was a disaster, been attacked by DDOS attack on the launch date with so many school of thought on the cause of the attack but it still worth it for investors with at least 2X return from their investment. They have also added Charles Hoskinson to their team which I think is a right move, looking at the maturity timeline for ICO investment it could be the next big thing.
Waves, it did have a better launch in recent times compared to some other ICO launch but does it worth more than 30,000 BTC of investment, jury is still out there to judge, The ICO flippers can be thanked for this who think they can flipped their profit from Lisk into waves, to me this makes the tokens overprice, I look at the fundamentals of the project compared to what BTS, NXT, Ripples are offering, does it have anything new to offer? I don’t know but it was Steve Jobs of blessed memory that said it is not important to be the first to create a project but it is important to be the first in your industry. There was a time the waves token was trading below ICO price let’s just hope it will be the success we all craved for.
The DAO, this is the most successful ICO in history but less than two month after raising more than $150 million the project was called off, I was very confident in the project because of the Ethereum team developers was behind it initially, but what got me skeptical later even before the blackhack debacle was that the team of developers have turned from coders into celebrities, the should know that from whom much is given much is also expected, when the 5 sins of DAO was released I read the paper and I was waiting for decisive action from the slockit team but what do they do they are defending the indefensible. It is a shame and a stain on the progress ICO has made in recent time, see for example Wings team have postpone there ICO launch twice already because of the uncertainty surrounding Ethereum Hard fork likewise Decent platform.
From the rise and fall of the DAO this are the lesson learnt.
Do not put what you cannot afford to lose in ICO’s, Cryptocurrency world is still new and mistakes are bound to happen
Do not invest in a project that do not have their crowdfund cap. A good example of ICO with crowdfund cap is DIgixDAO and with 5X return for investors so far.
Do not be emotional with ICO, The fear of missing, if you miss out on DAO and Waves ICO you would have got them at cheaper price when they hit exchange. Note: patience is a great virtue.
great information, you know your crypto
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Pretty interesting thread, Good to see I'm not the only one who thinks like this. Only invest in ICOs if you did the best possible research you can do and really believe in the future of the project. Wetter you're a short- or long term holder you should know what you put your money in. This is quite an interesting website I found: https://www.coincheckup.com Amazing opportunities came to light when I started using this coins to analyze cryptos.
Very good post. I was about to post a similair thread. Investing in cryptos is still a risky thing. We do need to look better at the insights of every coin. What team is behind it, is there any management. How strong is the product, is there any product at all? Do you know this interesting site? https://www.coincheckup.com Since I use this site I make so much less basic investment mistakes. On: https://www.coincheckup.com/coins/Nxt#analysis To check Nxt Report
Nice article. I was about to post a similair post. Only invest in ICOs if you did the best possible research you can do and really believe in the future of the project. Wetter you're a short- or long term holder you should know what you put your money in. I was wondering if anyone of you uses: https://www.coincheckup.com They researched and analyzed every tradable coin out there from a investment, team, product, transparency perspective. Really interesting.