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2023 Guide to investing in ICOs : Essential tips and strategies
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2023 Guide to investing in ICOs : Essential tips and strategies

In the face of blockchain and crypto-currencies, new types of investments are increasingly present: ICOs. They represent a tremendous opportunity for investors. In this article, we look at what an ICO is, how to participate in them and what their benefits are.

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Mis à jour le 11/26/2023 à 20:25

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What is an ICO ?

An ICO, or Initial Coin Offerings, is an innovative way to obtain funding for a crypto asset. A company that wants to launch an ICO creates a certain amount of tokens and offers them for sale to potential investors.

These tokens are called “tokens” and can be used to access features or services associated with the project, via the blockchain network. The funds obtained from the sale of tokens are used to finance the development and launch of the product or service proposed by the company, in the manner of a fundraiser.

From an investor’s perspective, this is an excellent opportunity to be one of the very first buyers on a project.

Tokens obtained from an ICO can be sold on exchange platforms such as Binance or Coinbase, or exchanged for other cryptocurrencies like Bitcoin or Ethereum.

Where to find Initial Coin Offerings in 2023 ? 

Investing in ICOs can be very profitable, but it is important to carefully select the projects to invest in to avoid scams and to bet on promising projects.

To do this, it is recommended to regularly follow the available ICO calendars. They provide key information about the projects, which allows you to position yourself in the most intelligent way. These include :

  • CoinMarketCap
  • Les Launchpads

CoinMarketCap is one of the leading platforms where valuable information about ICOs can be found. It allows users to access a complete ICO calendar as well as a list of available tokens on the market.

A launchpad is a launch system for cryptocurrency projects. They offer a simple and effective way for crypto projects to raise funds.

What is the difference between an ICO and an IDO? 

The operation is the same in both cases. The only difference is that the fundraising and the release of the tokens will be done on a decentralized platform for the IDO (like PolkaStarter), and centralized for the ICO (like Binance Launchpad).

How to participate in an ICO ?

There are several steps to participating in an ICO :

  1. Search for projects that are preparing to launch an ICO : You can use coinmarketcap, ICO Drops or search on launchpads as presented above
  2. Read the Whitepaper : The main documentation of the ICO called Whitepaper, describes the details of the project and its terms. To avoid fraud, it is often recommended to check that the whitepaper includes the identity of the team members behind the project.
  3. Hold cryptocurrencies on a wallet : To do this, open an account on a cryptocurrency exchange platform, make an initial deposit and buy Ethereum (ETH), stablecoin (USDT, USDC…) or other crypto as described in the ICO.
  4. Receive the tokens : After sending the funds to the platform linked to the ICO, the tokens will be credited to the address used at the end of the investment period.

These steps may vary depending on the ICO. Some of them will require the creation of a Metamask wallet. It is therefore necessary to carefully read the documentation related to the project and its operation, before committing to the process.

How do you know if an ICO will perform ?

To identify a promising ICO, it is essential to make a careful selection from the many options available on dedicated platforms. Here are some things to help you find reliable and innovative ICOs in 2023 :

  • The whitepaper : always read it carefully to understand the risks and opportunities associated with the project.
  • The team : check the identity of the people behind the project and make sure they have the necessary skills and experience to carry it out.
  • The market : understand the market in which the project fits and verify if it is growing or if it is already saturated. If the project in question meets a real and innovative need, then the ICO will be potentially promising !
  • Check the ICO data, especially those related to the sale of tokens, to see how many total tokens were issued or if they are locked in for a while.
  • The community : check if the project has an active and engaged community. The engagement behind an ICO can be an effective indicator to gauge the interest of the project and the possible number of investors.

Top 3 ICOs to come in 2023

The year 2023 is shaping up to be full of promising projects, as adoption related to cryptocurrency and blockchain is growing.

Here is a selection of some ICOs that look interesting to keep an eye on :

  1. Meta Master Guilds (MEMAG) : a blockchain-based mobile gaming portal project that focuses on the play-to-earn niche.
  2. C+Charge (CCHG) : a green ICO focused on the environment that aims to encourage users to use the platform to charge their electric cars.
  3. FightOut ($FGHT) : a Move to Earn based crypto project that offers users to play sports while earning tokens.

The best ICOs that have already taken place

Some past ICOs have broken records for return on investment (ROI). They include :

  • Ethereum ICO : it was launched in 2014 at a price of $0.34 per ETH. As a reminder, 1 ETH at its highest level was equivalent in November 2021 to $4890, or a ROI of x14,382 !
  • NEO’s ICO : launched in 2015 at $0.03, NEO reached $200 in 2018, recording an ROI of x6,667 !
  • The NXT ICO : one of the first ICOs ever set up. It was launched in 2013 where the NXT token was then obtainable at a price of $0.0000168. It reached its highest price in December 2017 at a price of $2.31: a ROI since the ICO of x137,500 !

Our opinion on ICOs

As far as our experience with ICOs goes, participating in them is a non-negligible lever in cryptocurrency investing. Find below 3 advantages and 2 disadvantages of ICOs.

3 Benefits

There are many benefits to investing in an ICO :

  1. Early access to a promising project : Investors can obtain tokens at very low prices while the project is still in the development phase, allowing them to benefit from a high earning potential if the project succeeds.
  2. Use tokens to access the project’s services and features : Tokens issued during an ICO can often be used to access the services or features offered by the project.
  3. Simplified investment process : Investors can participate in an ICO using existing cryptocurrencies or stablecoins, which greatly simplifies the investment process compared to traditional methods.

The 2 Disadvantages

As with any investment, participating in an ICO requires vigilance on certain points :

  1. Uncertainty Risk : An ICO can fail and investors can lose much or all of their investment.
  2. Lack of regulation : ICOs are not regulated in the same way as traditional public stock offerings, so there is an increased risk of scams or malicious practices.

ICOs thus offer investors an excellent opportunity to diversify their portfolio or expose themselves to considerable profits.

However, as with any other type of investment, make sure you fully understand the terms of the project before participating.

ICOs thus offer investors an excellent opportunity to diversify their portfolio or expose themselves to considerable profits.

However, as with any other type of investment, make sure you fully understand the terms of the project before participating.

⚠️ This article is published for informational purposes and should not be considered as investment advice. Crypto-currency trading involves risk and it is important not to invest more than you can afford to lose.

InvestX is not responsible for the quality of the products or services presented on this page and shall not be held liable, directly or indirectly, for any damage or loss caused as a result of using any goods or services highlighted in this article. Investments related to crypto-assets are risky by nature, readers should do their own research before taking any action and only invest within the limits of their financial capabilities. This article does not constitute investment advice.

Thomas

Thomas

Web editor for many years and SEO specialist, Thomas became an editor for InvestX when the site was launched. Passionate about the field of crypto and Web3, Thomas has made it his mission to deliver maximum value and introduce readers to the world of blockchains, considered for him as the world of tomorrow.

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