Knowing how to properly analyze an ICO is necessary both for cryptocurrency investors and for the development teams themselves. Each party has its own reasons for comparing this or that ICO with other offerings on the market. So how to analyze ICO’s?
Why analyze an ICO?
By conducting a detailed analysis of an ICO, investors will determine whether a given product can deliver the promised return on investment in the long term, and which of the available projects is the better choice. ICO authors will find it useful to look at successful sales of other tokens to understand what else needs to be worked on to achieve similar figures. The bulk of cryptocurrency supporters will be interested to know the opinion of other market participants about the ICO under consideration and to what extent the proposed solution can be revolutionary.
The difficulty lies in the fact that new ICOs are launched every day, and their number is several thousand per year. Some projects are very similar and many are simply nothing outstanding.
What to pay attention to when analyzing an ICO?
Considering how many tokens are thrown on the market, it is very difficult to separate the good ICOs from the bad ones. To do this, you need to conduct a time-consuming in-depth analysis of each project and its potential market. The easiest way to do this is to use a rating system based on a number of key parameters on which the success of an ICO depends. These include the project team, information about the ICO itself, the quality of the product presentation, and how well the marketing is done.
- Team. It is important that the profiles of the team members are easily accessible to the general public and contain sufficient information. Having photos and links to external professional sites, such as LinkedIn, builds credibility. The number of team members can also be an important parameter. If only two people were involved in the work, it is unlikely that such a project will be successful. If different people work on different aspects of the ICO, the chances of success are much higher.
- Information about the ICO. This information must be accessible and understandable. The start and end dates of pre-sales and the official ICO, options for buying during mass sales, which currencies are accepted for payment, the countdown to start/end and the price of the token – all this helps investors to understand and instills confidence.
- How the product is presented. It depends on the information contained in the official description. It should state what the product (platform, service, etc.) is, what the milestones and relevant metrics are, details about the team members, and the actual use of the tokens. Having a professionally filmed video with an overview of the product confirms that the team is serious about its business.
Should you pay attention to social networks? Definitely yes! With so many ICOs on the market, each project tries to attract as much attention as possible.