While many ICOs are run by experienced teams, there are also numerous frauds in the world of up-and-coming cryptocurrencies, and so it’s essential that you know what signs of trouble look like before investing.
You should be wary of any ICO that does not provide:
- A whitepaper.
- Any long-term plans beyond the ICO.
- Names of the team members.
- Community and social channels.
- Proof they are seeking to be listed on official ICO registries.
- A token-allocation plan.
- Project roadmap.
Additionally, any ICO that promises all investors will ‘get rich fast’ should be viewed with skepticism, and avoided entirely. There is simply no way to guarantee a project will produce millionaires, and to claim as much is irresponsible and predatory marketing. Such claims are designed to encourage investors to pour money into a project and then leave them in the lurch rather than deliver on these promises.
However, when an ICO is legitimate they do abide by these guidelines. One example of this is EPIK Token, which powers BLMP’s virtual goods platform. The team behind the EPIK token project have done the following:
- Written a comprehensive whitepaper.
- Provided details on the long-term plans for BLMP as a B2B2C platform connecting brands and digital platforms as well as EPIK token, including the EPIK app and wallet.
- Created vibrant social media and community channels where prospective investors can talk directly to the team, including the company founders.
- Signed up with ICO registries.
- Outlined the allocation of tokens.
- Included a project roadmap extending far beyond the ICO.
Given the sheer quantity of ICOs which may be in progress at any one time, having a set of guidelines to use in order to sort the legitimate ones from probable frauds is invaluable, and makes it easy to invest in promising technologies with far less risk.