What is an ICO and how do I invest in one?
ICOs are one of those topics that I always hear being asked about by newer members in the Crypto community. What exactly is and ICO? How do they work? How do I invest in them?
Well, an ICO (Initial Coin Offering) is similar in concept to an IPO (Initial Public Offering). Both are processes in which a company raises capital, however the difference is that investors of an ICO receive coins or tokens in return for their investment. An ICO can almost be considered an alternative form of crowdfunding in the sense that buyers come together and buy coins in order to get a project going. This model has been very successful and there are now more and more ICOs being launched. Some examples of successful ICOs are Ethereum, Lisk and EOS which still has an on-going ICO as we speak.
The actual Initial Coin Offering is a period of time in which anyone, who is legally able to invest in ICOs, is allowed to purchase tokens in exchange for other cryptocurrencies (Usually BTC and/or ETH). There are certain countries that have now perceived certain problems with ICOs and hence banned citizens from investing in them. These countries include China and South Korea. If you want to read about your country’s regulations here’s a link to an informative article by the Bitcoin Market Journal where they cover some countries more specifcally https://www.bitcoinmarketjournal.com/ico-regulations/
Now how do I invest in an ICO?
We are going to be looking at our ICO, Starflow, as an example. Starflow is currently in it’s Pre-ICO phase where buyers are given a 40% bonus for getting in early in the project. This along with all the other things Starflow does and stands for makes Starflow a lucrative choice.
The first step is to sign up on the ICOs website. Most of these ICOs have what is a called a KYC (‘Know your customer’) application. Know your customer ('KYC') is the process of identifying and verifying the identity of the contributors in the ICO. This is important due to the ban and increased regulations of ICOs in several countries. Signing up is easy and all that is required is to follow sign up procedure and to upload a picture of your ID or passport to verify your legitimacy and legal right to enter the ICO.
Secondly, you will have to deposit Ethereum onto the Starflow platform. This address can be found on the ICO dashboard once you have been verified. If you do not have any Ethereum I would suggest you read my earlier post on exchanges where I explain where you can buy this Ethereum or shoot me a message and I will gladly help you.
Thirdly, you enter the amount of Ethereum you would like to spend and you purchase the tokens. The minimum contribution for Starflows ICO is 0.1ETH and most ICOs tend to hover around this amount.
And that’s it. You have now participated in an ICO. Your STAR tokens in this case will be found on the Starflow ICO dashboard and can later be withdrawn or sold post-ICO.
Legal disclaimer: This is only my personal opinion, make of it what you wish. What does this mean? It means it's not advice nor recommendation to either buy or sell anything! It's only meant for informative and entertainment purposes.
Best regards,
NIcholas Stael von Holstein
Starflow
