Dissecting the White Paper and Roadmap of an ICO

April 12, 2018 by Adrian Thorpe

Initial Coin Offerings are all the rage these days, and as soon as you start buying into any of the major and more well-known cryptocurrencies such as Bitcoin and Ethereum, you are then possibly going to be interested in putting those cryptocurrencies to work for you.

An initial coin offering or ICO as they are known are a way for any start up business or established company to get finance to move their concept or company forward, and they do so by launching their own tokens or coins on top of one of the established cryptocurrency blockchains.

The most popular blockchain used for launching tokens is the Ethereum one, for it is an absolute breeze for anyone to put together their own smart contract that is then going to help them issue their tokens for the price they wish to sell them for.

However, investing in any start up or for that matter established company via an initial coin offering is going to be a risky thing to do, for you will need to ensure that the tokens you are buying are going at some point in time to increase in value.

If they do then you will be able to sell them on and make a profit, however if there is no demand for those tokens you are going to find it difficult to sell them on and the price of them can drop and there is always the risk they could become worthless too. Therefore, when doing your research regarding any initial coin offering you need to make a point of studying the whitepaper attached to any ICO.

What is a White Paper

In its most basic form a white paper is simply a business plan, that is going to lay out in a step by step fashion the way in which a business idea, concept or project behind any initial coin offering is going to work and operate and be rolled out.

What you need to ensure you do as an investor therefore is to spend as much time as you an looking through the white paper of every single initial coin offering you come across, and then see if you like the way the concept has been designed and what it is going to be offering you as an investor.

There is no getting away from the simple fact that any initial coin offering is going to have to have in place a solid and very experienced team, for it will be the efforts of that team that will ultimately determine if the concept, project or business idea is going to be successful.

In addition to the white paper you should also find a road map on the website of any initial coin offering, and that road map will give you an overview of how the concept is going to be rolled out and the expected time period each stage of the business is expected to run to, so do read that through too.

Cashing in Your ICO Tokens

When an initial coin offering is successful, and they have sold a certain number of tokens, then most digital currency exchanges are going to be very eager to get those tokens listed on their exchanges, for those tokens will be sought after.

However, sometimes for all manner of different reasons, some tokens sold as part of an initial coin offering may not be listed ion any of the major digital currency exchanges, and that may pose a problem for you when it comes to selling on your tokens and cashing in a profit or in some cases selling them on for a loss!

Therefore, it is also important to ensure that the initial coin offering you are thinking of buying into has some form of guarantee in place that the tokens will be listed on at least some digital currency changes and that there is going to be an easy way for you to sell on those tokens when you want to do just that.

At the end of the day you need to do a lot of due diligence when you are buying into an initial coin offering, and you should never take it for granted that everything you see being offered as part of an ICO is going to be put in place.

So please do ensure that long before you do part with any cash to buy into any ICO you spend as much time as is needed to fully check out every single aspect of any ICO that has caught your attention.