How to Invest in ICO — Step by Step Guide
Hi everyone, this time I will talk about ICO (Initial Coin Offering). This is a golden opportunity because today (6 Feb 2018), ETH is super low!!! “Be greedy when others are fearful, be fearful when others are greedy.”
For the people in the future that will read this article, I really wish you didn’t miss out on the greatest opportunity in 2018. Since January, Bitcoin (BTC) and Ethereum (ETH) prices have dropped massively together with other altcoins. Have they reached the bottom support yet? I don’t know. I am a fundamental investor, but Cryptocurrency today is undervalued. Why? The prices have dropped more than 66% in 50 days. Lightning network has been launched and made Bitcoin faster and cheaper in transactions, more people learn about how to launch ICO with ERC20 Token on Ethereum platform. Price drops due to FUD (Fear, Uncertainty, Doubt), but fundamentally Cryptocurrency and blockchain technology have never been better.
What is an ICO?
ICO is Initial Coin Offering. It is the time when a Cryptocurrency or Token is being sold to the public for the first time after Pre-Sale / Private Sale. It is similar to IPO (Initial Public Offering) in shares, but when you participate in an ICO, you are investing in an early stage startup. The risk is higher, the reward is higher too. You can lose all your money when you invest in ICO, you can also make 1,000% — 10,000% when you invest in ICO.
Initial Coin Offerings (ICOs) are similar to crowdfunding. Blockchain startups offer investors the opportunity to invest in their projects by purchasing a part of their Cryptocurrency in advance. In exchange for financing the project, investors receive digital tokens / Cryptocurrency at a very low purchase price.
ICO has extremely huge potential, but most people don’t really know how to invest in an ICO yet.
How to invest in ICO?
In this post, I will share about a few things to know to invest in ICO (Initial Coin Offering) with Ethereum:
- Understanding ERC20 Token
Most ICOs are using ERC20 Token, which is a standard token being used on Ethereum platform. You can invest in ICO by sending Ether (ETH) from your wallet to the ICO address.
For Decentralized Apps (Dapps) that are built on top of Ethereum platform, the token being sold can be used to pay for certain product/service of the Dapps. As an example: Hawala.Today (HAT) Token can be used to use its P2P Cryptocurrency-Fiat Exchange and Asset Management Services.
For new Blockchain projects, ERC20 Token is used to raise funding. Once the project’s main net is ready, we can swap the ERC20 Token that has been bought via ICO with the new coin issued for main net. As an example: EOS Token that has been sold during ICO can be swapped with its new coin when its main net launches.
2. Store your Ether (ETH) in MyEtherWallet or MetaMask
You have to send your ETH to your Ether wallet, it could be using MyEtherWallet (MEW) or MetaMask. You can follow the guideline of using the wallet here. You basically have to purchase Ether (ETH) from an exchange like Coinbase, and then send it to your wallet address. You can send a small amount first to make sure it is the right address, any mistake in the address will cause your Ether to be lost in the wrong address and you can’t get it back.
3. Send your Ether (ETH) to the right address for ICO
You must not send your Ether (ETH) from exchange! You can read in details about an example of ICO page here. Make sure you have enough Ether for Gas, you will be charged a certain amount of Gas every time you transfer Ether (ETH) or any ERC20 Token. You can learn more about Gas here.
Once you have sent to the right address for ICO, you will be able to receive your tokens once ICO is over. Please remember to follow all the rules for participatin in the ICO you want to, rules may be different in different projects.
If the ICO you want to participate in is not on Ethereum platform, you can follow the same guide, but using the right wallet for the coin. It is usually written in their ICO guide.
What if you miss out a great ICO?
No worries, ICO is the first time a coin is sold to the public market. After that, you can purchase it in exchanges. Cryptocurrency market is very volatile, the prices go up and down really quickly. Today (6 Feb 2018), the market is bleeding hard and you can purchase great Cryptocurrency investment at a discounted price. So you do not have to be sad when you miss out an ICO.
You can check some of my coin recommendation lists (Many great coins are on discount today at 6 February 2018):
1. Cryptocurrency to Watch 2018 — Top 5 (More than 1,000% potential return)
2. Kucoin Exchange List — Top 5 — Kucoin Exchange List of Cryptocurrency with Huge Potential
3. ERC20 Token List 2018 — Top 5 — Use Your Ether Wisely!
That’s it for my guide on How to Invest in ICO, if you gain something useful today, please give a “Clap” so that others can see it too!
