ICOs

How Can I Invest in Crypto? 4 1166

If you survived the crash course into Bitcoin and other types of cryptocurrencies, and you still want to get in on the action, the best advice would be to proceed with caution. If you want to know how to invest in crypto, as with any investment, the same rules apply. Don’t invest more than you can afford to lose and make sure to do your due diligence first.

The world of cryptocurrency is still so new and changes are happening daily. With the full on ban in China and the EU considering regulation, investors in crypto must be prepared to get in on a continually evolving landscape. Their investment is not without risk. In fact, there are plenty of risks to investing in an unregulated digital currency that has no governing regulatory body and is not internationally accepted.

Add to that the sheer volume of different types of cryptocurrencies available and your head may be spinning. How can you be sure of making a smart investment? Well, you can start out keeping these tips in mind:

Decide What Type of Crypto You Want

You can invest in coins, utility tokens, or tokenized securities. These three main kinds of cryptos are presented as an ICO, or initial coin offering, to raise funds. Just like with an IPO in the initial fundraising stages, except these companies create their own digital currency in the hope of attracting investors, who are looking for the next big crypo boom.

Consider The Long Term Potential

If you’re looking to join the lucky few and make your fortune overnight, sorry to say this, but you may be too late. People are no longer putting their money in and out, in and out. Investing is becoming a long game, and you need to place your money in a cryptocurrency and a project that has a long term future.

Just as you would when making an investment in any company, check out the real sustainable value of the project and look beyond all the marketing hype.

What Actual Value Do The Tokens Have?

This is a key point that people new to crypto often forget–to look at the value of the token. In other words, why was the token created and what is it for? Does it solve an actual problem? Is it needed? What does the token do in the business? If you can’t see any real value in the token and it isn’t tied to the business, it probably doesn’t have long lasting potential.

Look At The Management Team

With the lack of regulation and the ability to get rich quick, unsurprisingly come a lot of scammers. So, take your time to look at the management team behind the project. You should know if the company is serious if they’re open and willing to publish information about their team. See what each member’s background and real contribution to the project is and look for solid developers and experience in cryptocurrency.

Is There A White Paper?

The white paper isn’t the only factor to take into account, although some say it’s arguably the most important piece of a serious ICO. Here you will find out about all aspects of the project; the concept and technology behind it, and other essential information. If the white paper feels a bit thin to you or the ICO doesn’t have a white paper, that should raise some red flags.

Consider Safe Platforms

If you want more reassurance, the crypto world is beginning to regulate itself. Safe platforms like Descrow.com are starting to appear. All the ICOs on their sites have been previously vetted and have to pass certain criteria to avoid scammers. Their technology has to be safe to avoid hackers, and investors may feel safer parting with their cash in this way. It’s no hard guarantee that the project will take off, but at least it will be legitimate.

There is no safe bet when it comes to cryptocurrency. Looking back a few months before the crash, Bitcoin would have seemed like the obvious choice. So, beyond all the hype and desire to make a lot of money quickly, think long term and invest in a project that you really believe in, and that will have the best chances of growing–and making you money with it.

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Christina is a technology and business communicator who has worked with high profile ICOs and blockchain influencers to break industry news.

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Top 9 Crypto Buzzwords You Need to Know 6 5884

crypto buzzwords

The crypto world is in a constant state of flux. Innovative ICO after innovative ICO appears. Markets rise, markets crash. And as each day goes by, the crazy, hair-raising ride that is cryptocurrency becomes decidedly more interesting. Its abundant vocabulary becomes richer as well, and new crypto buzzwords crop up daily.

To really understand the ins and outs of this complex ecosystem (can anyone fully claim to do that?) you’d need an encyclopedia updating in real time. But, just to get you started, here’s how to hold your own in any cryptocurrency conversation.

These are the top 9 crypto buzzwords you need to know:

Bitcoin BTC 

Well, obviously, Bitcoin tops the list of crypto buzzwords. In fact, the vast majority of people automatically think of Bitcoin when they hear the word ‘cryptocurrency.’ Emerging shortly after the financial crisis, in 2009, you can read more about the ideology behind Bitcoin here. But, know this: If you don’t have this word down pat, you can’t even think about talking crypto.

Ethereum ETH 

The second largest cryptocurrency after Bitcoin, Ethereum in theory is not in competition with the world’s most famous digital currency. Running on its own blockchain, Ethereum supports apps and trade through a system of smart contracts.

Blockchain 

Dabble a little in crypto and it won’t be long before you’re hearing about the technology behind digital money–the blockchain. Actually, generating cryptocurrency is just one use case for blockchain, since the technology can record any information and keep it safe and immutable on its decentralized system.

We’re still discovering just how many uses this new technology has, but it’s widely considered the most disruptive technology since the internet.

Cryptography

This is the technology applied to all transactions in the blockchain. It’s essentially a process of scrambling information, making it unreadable, and allowing transactions to be kept anonymous.

Satoshi

While it sounds like a raw fish dish, Satoshi is actually the smallest fraction of a Bitcoin that you can buy. It’s also the first name of the suspected inventor of Bitcoin, Satoshi Nakamoto, (although this is something he denies).

Market Cap 

This term is used a lot and is a good indicator of how large a cryptocurrency is. You basically take the total supply and multiply it by the price to figure out its dollar value.

Mining

Beyond flashlights and hard caps, mining in the crypto world refers to the computational process of generating cryptocurrency on the blockchain. Each computer in the network uploads its power, and miners are rewarded for their efforts in digital currency.

Hashing

A “hash” is a computer program that basically takes any information and turns it into a set of numbers and letters of a certain length.

Forking 

Soft forks, hard forks, the concept is basically the same. Forking is when there is a split in the digital recordings on the blockchain, usually used to right a wrong, such as the hacking attack on Ether in 2016.

While you may not claim to be an expert after grasping these basic crypto buzzwords, at least you won’t look blank when you hear them thrown about in the office. From mining and hashing to forking and cryptography, little by little you’ll hold your own in the cryptocurrency world.

7 Red Flags to Watch For When Investing in ICOs 3 3625

investing in icos

For many people thinking about investing in ICOs, it may be their first time investing. When traditional opportunities are only open to a selective few with a high net worth, cryptocurrency has democratized investing for all. But it also means that there are a lot of first timers out there not sure of what to look for when they part with their cash.

81 percent of ICOs end up becoming scams. That’s a pretty grim panorama. You have to have an iron cast stomach to want to continue investing in ICOs. But, if do you want to try your luck and see if you can back a winner, here are seven red flags to watch out for first.

1. Too Many Buzzwords

“Decentralized,” “immutable,” “distributed,” may all sound like very important words, but you need to make sure you understand what they really mean. And even more importantly, that your ICO team does as well. There’s been so much marketing hype surrounding Bitcoin and the blockchain, that many people have fallen victim to it, including the ICO startups themselves.

They may be in love with the idea of no regulation or centralized authorities, but how important is it to their actual business? And can they demonstrate a clear way of using the technology? In short, is it more than a fluffy concept on a white paper?

2. Is Their Token Really Needed?

It may be hard for a layman investing in ICOs to assess whether an ICO’s token is really needed. But, try to examine the business proposal. Could it be carried out without using cryptocurrency? What function does the token have within the actual business? Is it being built on a new platform, when it could really be built on Ether? If the ICO has a useless token it’s chances of failure are close to 100 percent.

3. An Unconvincing Management Team

This is pretty much investing 101 in any kind of area. Most top investors in IPOs will study the management team to make sure it has the right balance of passion, leadership, and technical knowhow. While an individual investor may not be able to assess this, be sure that the ICO actually has team members on their site.

If the people don’t even appear on their page, it’s quite possible that they are scam artists. And if they do appear, be sure to run a quick background check. LinkedIn or Google should be enough to at least make sure you’re on the right track.

4. Ultra High Reserves

It could be a good thing that your prospective ICO team has a high amount of reserves. But this depends on their plans to use them. If the funds are allocated to use throughout the roadmap, and not just in the early stages, that’s a good sign of intent. But, if there’s no explanation in the white paper or anywhere else about how these funds will be spent, you could consider ultra high reserves to be a red flag when investing in ICOs.

5. No Code

If there’s no code to support the idea behind the ICO, it may never materialize into something more than an idea on a piece of paper, or a fancy website. At the very least, your ICO should be able to display some technical knowledge. This means demonstrating their ideas with some working code. Being able to write the code required is a basic prerequisite and no company should be asking for finances before showing that they can translate their ideas to code.

6. A Long and Confusing Roadmap

There may be no hard-and-fast rule when it comes to how long a roadmap should be. But make sure that it makes sense and is coherent. Generally speaking when investing in ICOs, you want to get behind something that’s aiming for about two years to get off ground. If it’s longer than that, consider it carefully and ask a lot of questions.

An ICO with a five-year long roadmap may not have a plan for solving problems should it flounder after six months. And that’s the point at which they could easily run with investor money before the project ends.

7. The Same Old Faces investing in ICOs

If you’re flicking through ICOs and you see the same faces appearing on the advisory board, that could be a red flag. While it could be genuine, there’s also a possibility that the advisors are trying to profit from as many projects as they can. Don’t give them your money, too.

ICO investing isn’t for the faint-hearted and it shouldn’t be done on a whim or an instinct. Take some time to do your research, watch out for these seven red flags, and you may just come out on top.

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