How to Know if You're Investing in a Healthy ICO

Initial Coin Offerings, popularly known as ICOs are emerging as a popular method of raising funds these days. Many companies, particularly startups are resorting to ICOs for generating funds for their businesses. In 2017 alone, there were over 900 ICOs, an average of 2.4 ICOs per day - which is an impressive statistic! 

However, as impressive as these numbers may be, not all ICOs end up being what they promise. With the rise in the number of ICOs over the past few years, there has also been a sharp rise in the number of ICO-related scams. It is essential for investors to stay alert and properly research about the company they are willing to invest into. 

ICOs tend to find a number of investors as they allow even non-accredited investors to invest into them. People who missed out the Bitcoin hype-train at the time when Bitcoin prices were skyrocketing are now resorting to ICOs as a means of making some quick cash! With hundreds of ICOs coming out every month, it is critical that investors analyze the promises well before they invest into the ICO. 

let us take a detailed look at the signs which tell you if you are investing into a healthy ICO. 

How To Know If You’re Investing in a Healthy ICO or a Scam:

There are some questions that you need to ask yourself and a little bit of Googling-around that you need to do to understand if the ICO that you are investing in is a legitimate business idea or just a scam. 

Do you believe in the idea that the ICO promisesIJ

Basically, does the company issuing the ICO intend to solve an existing problemIJ Are there other similar companies doing similar thingsIJ Is the problem that is being solved something that you relate toIJ Sometimes, some ICOs may be created to solve a hypothetical problem - something that customers may not fully buy into. These ICOs are likely to be sham ICOs, being run for the sake of publicity, or worse, to make you part with your hard earned money. 

look Up The People Involved

It is essential to do a background check before you invest any sum into the ICO. Regardless of the amount you put into the ICO, it is crucial to check the background of the founders. Sometimes, scammy ICOs tend to give out fake names and social media profiles. Some of them even use stock images as photographs of these people! look up their social media profiles, especially on linkedIn. look up their contributions to various publications, or personal blogs - or basically anything which proves that these people are actually who they claim to be. 

Are The Goals Set By the ICO realisticIJ

This is a critical question that every investor needs to ponder upon before investing into an ICO. Sometimes, fake and scammy ICOs can put up some very absurd roadmaps. Take a look at the whitepapers published by these ICOs and take a careful look at the goals that these ICOs have set. A scammy ICO would almost-always been overambitious in achieving their goals.

These things are highly recommended to understand the kind of company you are investing in and to ensure that you are not being caught in an ICO fraud. In case you do not want to go through this process of verifying ICOs yourself, websites such as ICOTokenNews do this for you as they publish news updates and announcements regarding various legitimate and secure ICOs!