Everyone today is talking about cryptocurrencies and why should they. Bitcoins had touched unparalleled Heights within the last year and so have various other cryptocurrencies. Although a substantial number of people are investing in cryptocurrency yet, it is important to remember that no country in the world has made it wholly legalized. New investor finds it extremely difficult to understand the legal aspect of investment and how they can reduce the risk.
Cryptocurrencies such as ethereum and ripple have made it big and are considered as a reliable investment but as they are growing people are looking for new coins that can help them make a fortune. It is important to remember that not every cryptocurrency will make it big in the digital market.
Every day new coins come up, but a lot of them are fake. Some websites are available on the internet to attract traffic, and there are also those that build an attractive environment to collect investment and then run away. New investors need to be extremely cautious when buying any cryptocurrency especially if it is an initial coin offering.
A large number of people are confused about the differences between crowd funding and initial coin offerings. Crowdfunding is similar to the initial price offerings of the stock market. When investors put in money in crowdfunding, they get a share of the company in which they are investing however when they invest in cryptocurrency they only get a digital token whose value may increase within a short term.
To be able to select the right choice among the various crowdfunding options there are multiple things that you need to consider. Below we have listed down some of the points that may help you identify a suitable cryptocurrency fundraising-
- The company raising the fund would be regulated and Incorporated
- All the required legal documents and required rules would be available on the company’s website
- A working prototype of the project would be possible with the company
- Most of the reliable forms will provide you with documentation on the work progress and their targeted goal
- The development team and the administrative people will have a solid background and will be active on professional social media platforms.
- A white paper defining the approach and the road map of the company would be available
- More focus on the website would be given to information rather than attractive designs and colors
- Proper disclaimers and alerts would be provided to the user to ensure the credibility of data and adequate communication with the potential buyers of the initial coin
Investment in the stock market is not that complex, however, to be able to get the best out of initial coin offering you need to have a good understanding of how the blockchain technology works, check ICObuffer for more information. Selection of the initial coin is also outstanding. If a company is making initial coin offerings through a legalized crowdfunding, there is a high chance of it being legitimate and is worth consideration for investment purpose.