ICO

What is ICO initial coin offering?, What is ICO data protection?, What is an ICO token?, ico cryptocurrency, ico meaning,ico offer, ico bitcoin, ico definition, ico data protection, ico wiki, ico blockchain, What does ICO mean

 What is Initial Coin Offering?

ICO is the abbreviation of the initial coin offer. This means that a buyer offers some new cryptosycurrency or some units of crypto-token in exchange for bittoine or atherium such as cryptocracies. Since 2013 ICO is often used to fund the development of new cryptocurrency. Pre-made tokens can be sold easily and can be traded on all cryptocurrency exchanges if they are in demand.

With the success of Etherium icos, more and more uses are used to fund the development of the crypto project by issuing a token, which is integrated in the project in any way. With this turn, the ICO has become an instrument that can revolutionize not only the currency but also the entire financial system. ICO Tokens can become tomorrow's securities and shares.

If you are looking for the biggest trend in today's cryptology, then a look at the initial coin offer (ICO) can be a good start. The idea of undoing the token coins of a cryptocurcency or blockchain project has evolved into a crazy successful instrument to raise funds for the development of a new application. Our guide gives an overview on the initial coin offer-ICO and presents the most past, present and future ICOs.

You are probably familiar with the IPO, or the initial public offering, where companies sell the stock to raise money. Simply put, the ICO is a similar game and stands for the initial coin offer.

With the advent of blockbuster technology, we are now able to make trustworthy transactions without the need for intermediary parties. Technology is a big step towards solving the issue of Digital Trust.

Given this progress, technology startups are now turning to blockchain technology to raise money from people all over the world. This is an exciting development in crowded resource projects and this means that people can now invest in upcoming startups with some limitations.

The startup initiating the initial coin offerings is basically accept cryptocracies in exchange for token sales. These tokens are technically a lot of stock (not legally) and investors buy them in the hope of future profits because these tokens prices increase.

History of Initial Coin Offering

Perhaps the first cryptocurrency wave delivered by the ICO was. In early 2013, Ripple Labs started developing Ripple named Ripple and made One Hundred billion XRP tokens. The company sold these tokens to fund the development of Ripple platform.

Later in 2013, MasterCoine pledged to execute smart contracts and to make a layer on the top of bittoin to token to the bitcoin transaction. The developer sold a few million Master tokens against bitcoins and received approximately 1m dollar.

Many other cryptocortors have been funded with the ICO, for example, Lisk, who sold their coins for approximately  5m dollar in early 2016. Although the most prominent Etherium is in the middle of 2014 the Atrial Foundation sold ETH. With it, they get approximately $ 20m, which has become the largest crowd till now and works as a capital base for the development of Etherium.

As soon as Etherium exposed the power of smart contracts, it opened the door for a new generation of initial coin offer.

How Do ICOs Work?

All ICOs start with an idea. A startup comes with an idea for a blockchain related project and it offers to the community.If startup gets traction, then they go ahead and formally prepare a white paper that provides all the details for technical aspects and future plans from the team working behind the project.

Then the other details are decided, in which the number of tokens to be distributed, the cost of each token and how the tokens will be used in the project's ecosystem.Marketing campaigns are launched to achieve speed expeditions and ICO date is unveiled when the token sale starts. There is usually a defined time period for raising the required fund, after which the sale closes.

Investors then start receiving their tokens and plans are made to stay live on exchanges for business.

Obviously, this is a simplified summary and a lot of work goes on behind the scenes, but the end result is a pool of early investors with the hope of future profits, which is getting a token from a promising startup.

Legality

Most investors are also worried about the legal status of the ICO - something that is not enough.

So, are ICO legal? The answer is yes and no.The problem here is that among the following rules, especially in the United States, the people of the Securities and Exchange Commission.

According to the SEC rules, you can not sell securities without proper compliance work and since the ICO is currently irregular, therefore there is a big question mark in each case. However, the SEC sent a warning signal in the case of the DAO, it called the sale of securities instead of token. As an investor, it is your responsibility to do some research and stay away from the ICO, which may come under the purview of securities.

The legal status of the ICO is mostly undefined. Ideally, tokens are sold not as financial assets but as many other things as digital items. In this case, in most jurisdictions, funding with the ICO is not regulated, which makes the experienced counsel very easy on the board and paperless with this issue.

However, some jurisdictions are familiar with the ICO and regulate them equally in the sale of shares and securities. DAO's superb effect has done a good job in terms of kindle regulators. Therefore, at present, the ICO is mostly in the brown area, in the future they will be most regulated. It can bear some financial and legal risk for investors. Apart from this, costs and efforts for compliance with regulation can reduce the benefits of ICO compared to conventional means of financing.

Differentiate ICOs and securities

Here many factors should be considered, but none of the most obvious things is the internal value of tokens, which comes from its utility.Each ICO has a white paper and you should read it carefully. The token that you want to buy should be used-case. It should not be used only for financing, it should be a real place in the proposed project.In the United States, they use the How Test to separate the ICO from the securities, and here is a summary of summaries for you.

Test for ICOs

Developed by the Supreme Court of the United States, the How are defines securities according to the Securities Act of 1933 and has four limbs:

Due to investment of money

Expecting profit from A

General enterprise

Depends on the efforts of a promoter or third party.

Generally, all ICOs fit into this statement because money is invested, investors are expected to profit and ICO is a common enterprise. 

If the success of the ICO relies entirely on the team behind the startup, then it is likely to be called security. However, any real ICO requires an active community which contributes, whether it is testing new developments or voting for new directions.

As long as you are an investor, to play an active role in the direction of the success of the project, it should be safe to move forward.

Avoid ICO Scams?

Needless to say, where there are big success stories, there are also ICOs who were busted with bouncing capital. Given the number of ICO launches these days, you get a wide selection to choose from but here are some suggestions to avoid the ICO scams.

Look in the team

This is usually where most ICOs fail. The team behind the work project is the best important elements. If people working behind the scenes do not have the necessary skills, then there is no way to come into life.

Be careful when an ICA fails to reveal information about the team behind it. Even when you get the name, be sure to search for them and verify their social profile on LinkedIn and so on.

Profit and Loss

Many ICOs have been fortunate enough for investors. For example, ETH .05 was sold at bitcoin and today worth 0,5 BTC. Benefits: 10,000 percent. REP were sold for about 0.005 each and are now trading at 0,01. The advantage in the cost of 100 to 500 percent in bitcoine is common for successful ICOs.

On the other hand, many ICO ends with the loss. Cryptocracies like Lisk, IOTA-Token or Omni have not kept prices in bitcoin, the tokens are evaluated in the ICO. Often the ICO is also used by scammers and semi-scammers: Create a shiny website, write some blocks of Bushshit Bingo, promise the biggest project / cryptocurrency, and if you only get 50 or 100 bitcoins, be happy.   In addition to large and successful  ICOs such as Lisk, Melon Post, Ogur or Economy, many small and shady ICs collected money and did not give anything.

Examples for successful ICO

Augur

Melonport

Golem

ICONOMI

Singular DTV

First Blood

Digix DAO.