Initial Coin Offerings (ICOs) are the latest trend within the financial sector. However, more than just a buzzword for the industry, they have seen significant success within the past year as CNN previously reported that the money raised via ICOs surpassed early stage VC funding.
However, with more and more investors turning to cryptocurrency, there is still some confusion within the industry about how you can move from traditional investment to funding an ICO. Navigating the minefield within the ecosystem can cause some confusion but with the right guidance and understanding of the benefits and risks associated with this new model, will enable potentials investors to decide if an ICO is right for them.
The first step in investing in an ICO is converting your real life money into a Cryptocurrency. Most ICOs attract investors from around the world and therefore use Bitcoin as universal method of payment as it holds its value well and means investors don’t need to worry about conversion rates.
Once you have some cryptocurrency you need to move it into a secure wallet to give you control over how you use your tokens and invest in an ICO.
Choosing the Right ICO to Invest In
The next step to investing in an ICO is choosing the right project. In a previous blog we outlined how to choose the right ICO but in short, you should look for one that is reliable and has a detailed and viable plan in place to make it successful.
There have been some ICOs in the past that haven’t been successful and therefore it’s essential that you consider your options before jumping right into investing.
Typically you send your investment directly to an ICO and they will send you your tokens. Once you have these, you need to store them securely until you either want to sell them or when they are more profitable.
Whilst investing in an ICO does have its benefits there are also risks associated with this new model. As with any kind of investment, it’s essential to seek advice from a professional who will be able to consult and guide you through each stage so that you feel comfortable with your investment.
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