There is an ever-growing number of cryptocurrencies coming onto the market on an almost daily basis. For the investor, each one seems to be based on genuine merit. While the big guns in the industry such as Bitcoin, Ethereum, Litecoin, etc. are sure bets the lesser known tokens can be a bit of a conundrum. Not all are created equal, and there are also many scams out there, which has come to light more and more often of late.
Developing a Due Diligence Process.
First and foremost it is imperative that you understand the integrity of the token. What is it that the ICO wants to achieve. This is where you ensure that you read the white paper from beginning to end. This is where the foundation of the ICO lies. You will be able to understand from the white paper if this coin is offering a solution or dealing with an issue that has a wide audience for it to gain popularity. As a potential investor, you need to understand if this offering is a real solution entirely.
What is very important as well as to determine how many other ICO’s offering the same solution. There is no need for hundreds offering the same service. That is a good indicator of whether to invest or not. Added to this is what kind of market is there for this offering.
Once you have established that token is speaking your language, you need to get to know and investigate who is behind the particular token. The things you want to look at is the past history specifically regarding the solution they are offering.
Check the Team and other Community Members
Google Chrome offers a verification option to check whether photo’ used are authentic. Once this has been established you can use avenues such as Facebook, Linkedin and Google to research and investigate members of the team. Besides verifying if they are legit, you also want to know that there are ample members to facilitate the white paper they have in place.
Other members of the community are the advisors. You need to be very wary of who you are taking advice from, and you need to search each one of those people too. Don’t leave anything to chance,
There is nothing in life that is guaranteed effortless money. Should any of the ICO’s you are looking to invest in offering a surreal guaranteed return, this is a huge red flag. Our suggestion at this point would be to walk away immediately. If it seems too good to be true, it is.
Investors & Partnerships are a great sign
If you investigate and find there are some big investors this is an excellent indication of their validity. Investors do rigorous due diligence.
While some ICO’s use fake partnerships to bolster their offerings, if the partnership is authentic it could pave the way forward for the ICO to reach great heights. So investigate the partner as well.
Vertex is a perfect partnership that would validate authenticity for an ICO. With the massive investment by Saudi Billionaires who already have a proven track record with tech start ups, the partnering for an ICO with Vertex would create a strong credibility as well as proven track record that investors can see tangibly.
It is essential to understand coin distribution and to understand how that particular ICO is distributing their tokens. How many tokens do they distribute between founders and key players and how many are they releasing during the initial coin offering? Are they keeping some back for future release?
The website of any business should represent everything that it stands for, and just by visiting the site you should be able to understand the nature of their business, what they stand for and who the key players are, as well as where they are going.
Check pictures used that they are featuring real pictures, not just stock picture.
Authenticity is key.
You must always bear in mind that you are solely responsible for your investment and so there is never enough due diligence to be done to safeguard from scams and hoodwinkers. You need to look and relook at every aspect of the ICO you want to invest in. It is estimated that 99% of all ICO’s will fail. We cannot recommend more highly that you do your due diligence
This is a press release. Trustnodes has not undertaken any verification of any of the above statements and any statement or project contained therein is not necessarily endorsed by Trustnodes. Readers are strongly urged to do your own research.