How to participate in ICOs 1000% faster

Did you ever wanted to participate in an ICO but found the process confusing? Do you have to spend hours learning how each specific ICO works? There’s a better way. Here you’re going to learn how all the ICOs work so you understand that they are essentially the same with some useful tricks to participate faster.

You’ll save hours of learning how each of them work by the end of this tutorial because I’m going to show you the most common ways companies raise money for their ICO.

I’ve worked with several ICOs in the past so I experienced the different approaches to raise the funds necessary for the company and I’m going to show you from my experience what you need to learn to partipate faster, safer and save hours of confusion.

This guide covers the following topics:

1. The most common ways companies use to raise money for the ICO
2. How to participate in an ICO faster to save hours of confusion
3. Examples of how you would do it in the real world
4. Conclusion

1. The most common ways companies use to raise money for the ICO

In the backend, what happens when you send your crypto money to an ICO is usually the following:

1. You go to the company’s website
2. You see the address of the crowdsale contract. This is the contract that will receive the money and do the needed calculations to store it safely until the ICO is completed
3. You use metamask, myetherwallet or parity to send whatever amount of ETH that you want to use to participate. It’s important that you send an amount between the minimum and the maximum
4. The crowdsale smart contract receives that amount of Ether
5. Depending on the ICO, the contract can store that Ether inside that crowdsale smart contract or send it directly to a multisignature wallet. In some cases the funds are stored separately in another contract to make sure the funds are locked until the goal is reached
6. When the ICO is successfully completed, that ether is distributed across several wallets to keep it safely and the tokens purchased during the ICO are sent to the people that participated in it.
7. The tokens can also be sent directly to you after receiving the Ether from the ICO but can be locked until the ICO is done to avoid cases where people sell the tokens before the ICO is completed

Each ICO is different but this is the most common way of raising money with a crowdsale smart contract in exchange for tokens.

The goal is always to keep the money safely until the ICO minimum funding goal is reached. If that goal is not reached, usually the tokens and the ether will be refunded. In some cases, the company can decide to create another ICO. Right after that one.

So that’s the process:

You send ether → the contract stores that ether safely → you receive tokens in exchange for ether → the ICO goal is reached → the tokens are unlocked for you to use them however you want.

This is the safest way to raise money without problems. Remember than an ICO is a delicate process because they are handling big amounts of money so mistakes can happen.

That’s why I always recommend to do “Test ICOs” where a small group of people simulate the ICO without real money on one of the Ethereum’s testnet to see how it will go. It’s excellent for finding parts where the investor can get confused and to fix Crowdsale smart contract errors.

2. How to participate in an ICO faster to save hours of confusion

Imagine this situation: You go to an ICO rating website to see which ICOs are the most interesting ones. You read their whitepapers, you understand the concepts behind them and you trust the teams to complete them.

Now you decide that you’re going to participate in 3 of those ICOs. However you spend about 2 hours for each of them to understand the roadmap, the ICO participation terms, the possible situations, how the tokens will be distributed and so on.

After that much work you may forget the project and months later suffer the consequences of not being a participant of such a successful project.

That’s why it’s very important to get the core information to participate faster and easier. You want to minimize the time and effort required to save your mental energy for when you need it most.

At some point you’ll want to sell your tokens for a sizeable profit so you have to know where and how you’ll do it.

Each ICO is a bit different but most of them have several things that you have to understand 100% before participating. These elements are:

1. The ICO start and end dates
2. The ICO minimum and maximum purchase
3. The price per token
4. When will the tokens be unlocked or distributed?
5. When will you be able to sell your tokens on exchanges and which ones?

Those 5 points are the main elements that you have to understand fully to participate in any ICO. Once you know them, you can participate with confidence.

Following, I’ll explain each of those points in detail so that you know where to find that information faster. Then, in the next section, I’ll show you 2 examples of real ICOs and what I do to find that information:

1. The ICO start and end dates

This is the most important information because you want to know when the ICO starts to be ready to participate. In some cases you’ll be able to participate in pre-ICOs if you’re fast enough. Which is great for better prices.

2. The ICO minimum and maximum purchase

The minimum and maximum purchase are usually set to avoid cases where big investors get most of the tokens. I’ve seen projects where only about 10 investors get all the tokens while leaving thousands of interested users without a chance to be a part of that project.

Also the minimum purchase limit is set to keep things organized with only the most loyal investors while avoiding “tire kickers” who are not really buying that many tokens.

In pre-ICOs and private fundings, the minimum purchase limit can be set to a very large number like 10 ETH to only get loyal, dedicated investors.

You need to know the max and min purchase to participate faster in the ICO because if you send an amount of ETH out of those ranges during the ICO, you may lose your chance to participate since some projects are really popular and they get all of their tokens sold in a matter of minutes if not seconds.

3. The price per token

The price per token is key to participate because you want to know how many tokens you’ll get to see what chunk of the ICO-pie you’re getting.

It’s not the same to get 1000 tokens when there’s a total of 100 billion tokens than to get 1000 tokens when there’s a total of 100 thousand tokens.

The less total token there are, the more valuable are your tokens so it’s essential that you understand how many tokens you’re getting for your Ether.

4. When will the tokens be unlocked or distributed?

Each Initial Coin Offering is different. Some will give you the tokens that you purchase immediately, some will wait until the end of the month to give you your tokens.

You want to know when you are getting your tokens since it’s the only thing that keeps you connected to the project. If you don’t have your tokens, you are not in the project. You can’t sell the tokens nor you can use them.

Most of the companies will provide you with such information in the Frequently Asked Questions section or in the investment page.

5. When will you be able to sell your tokens on exchanges and which ones?

Selling is probably your ultimate goal since you want to make a profit on your investment. The best time to sell if often immediatly after the ICO when the price is still high.

If you really believe in the project you’ll keep your tokens for years.

However it’s key to know when will you be able to sell your tokens on exchanges and which ones are supported. Not all exchanges are equal and there’s a ton of them.

You want to participate in projects with good exchanges like binance or etherdelta where you can trust them with your tokens.

You can usually find the information regarding the exchanges in the roadmap section of the website. If not, you’ll have to take a closer look to the whitepaper and maybe ask the developers on twitter or telegram since they are the ones who know the process.

I usually don’t participate in projects that don’t say a word about the exchanges since I’ll want to sell the tokens at some point.

3. Examples of how you would do it in the real world

Now I’m going to show you examples of how I gather the main information needed to invest in an ICO. Those 5 points from the last section above.

First I go to any ico rating website to see gain access to the most popular ICOs. The more popular they are the better. After reading some whitepapers, I choose 2 or 3 ICOs where I want to participate in:

First example, a decentralized insurance project

You can usually find all the information that you need to participate in the whitepaper. However most of the whitepapers are bulky so the key information is hard to find, therefore I’m going to look around for that knowledge.

1. The ICO start and end dates

The first thing that I’m looking for is the the ICO start and end dates to know when to participate. In this particular project that information is shown right directly in the home page at the top, which is awesome:

2. The ICO minimum and maximum purchase

After that I’m looking for the ICO minimum and maximum purchase to know my ranges. Some ICOs only allow big purchased starting from 5 ETH, others don’t have any limits. It depends on the project.

To find that information, I’m looking for a section called “ICO” or “TGE” which means Token Generation Event. In this case that section is called “Tokens”:

There I can see general information about the ICO. I can’t find any data regarding the purchase limits so I’ll assume that you can send whatever amount of Ether you want. The hard cap is 10k ETH so any amount will be fine.

3. The price per token

The price per token is also specified in that section:

Which is important to understand how many tokens you’ll get.

4. When will the tokens be unlocked or distributed?

Now I need to know when the tokens will be distributed or unlocked to use them.

Most companies have a FAQ section which usually contains the information that I’m looking for to invest in this project. The FAQ section is accessible from the navigation bar at the top. However in this case they don’t have a FAQ section.

So I had to go back to the whitepaper to try to find when and how the tokens purchased during the ICO will be distributed. I haven’t found any information about it.

In fact, there isn’t any information regarding the ICO apart the “Tokens” section. This is a red flag. You don’t want to participate in such project where you don’t know how you’ll get your tokens and when.

Maybe you can get that information if you apply to the whitelist of participants or if you ask them in the telegram group. But that’s uncertain.

5. When will you be able to sell your tokens on exchanges and which ones?

Finally I’m looking for the information about exchanges since I want to know which exchanges are adding this token to sell it later on. That data is usually in the roadmap:

Unfortunately I didn’t find any information regarding the exchanges which means that the tokens won’t be available for resale until an uncertain date.

Another red flag. I wouldn’t invest in this type of project unless I’m really interested in the technology and I’m willing to ask in the telegram group for key data regarding the ICO.

Let’s see another case.

Second example, a decentralized registry project

1. The ICO start and end dates

The first thing I do after reading the whitepaper of the project is taking a quick look at the home page to read the key information and then focus on the navigation bar.

Because I want to get some basic ICO information, I’ll start by searching for a “ICO”, “TGE” or “Tokens” section in the navigation bar:

In this case such section is called “Token Sale Details” and it contains most of the information that I need.

The ICO starts at July 6th and end by the end of July.

2. The ICO minimum and maximum purchase

That information is in the same “Token Sale Details” section:

And the minimum purchase is 0.05 ETH while there isn’t a maximum purchase limit.

3. The price per token

The price per token is also in the same section:

Which gives you 1 token for $0.067 USD dollars.

4. When will the tokens be unlocked or distributed?

I usually go to the roadmap or the whitepaper to find out more about when will the tokens be distributed. In this case they don’t provide any information regarding that.

5. When will you be able to sell your tokens on exchanges and which ones?

Same case, in the roadmap you can usually find information about the exchanges that will use this coin however I couldn’t find anything regarding that. Not even in the whitepaper.

In many projects, they provide you with the key data regarding the tokens and exchanges in the investment page where you see the address of the ICO contract to participate. It’s up to you if you want to wait until such page is available or if you prefer to get all the data upfront before the ICO.

Conclusion

All of this is from my personal experience and opinion. I wrote it to show you how I go about choosing projects while saving my mental energy. By no means this is financial advice. You decide where you invest and it’s your own responsability.

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