An Initial Coin Offering (ICO) is used by startups to bypass the rigorous and regulated capital-raising process required by venture capitalists or banks. In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for legal tender or other cryptocurrencies, but usually for Bitcoin.
Initial Coin Offering means that someone offers investors some units of a new cryptocurrency or crypto-token in exchange against cryptocurrencies like Bitcoin or Ethereum. Since 2013 ICOs are often used to fund the development of new cryptocurrencies. The pre-created token can be easily sold and traded on all cryptocurrency exchanges if there is demand for them.
Many view ICO projects as unregulated securities that allow founders to raise an unjustified amount of capital, while others argue it is an innovation in the traditional venture-funding model.
Several projects used a crowdsale model to try and fund their development work in 2013. Ripple pre-mined 1 billion XRP tokens and sold them to willing investors in exchange for fiat currencies or bitcoin. Ethereum raised a little over $18 million in early 2014 — the largest ICO ever completed at that time.
Along the way, you may make a few investing mistakes, however there are big mistakes that you absolutely must avoid if you are to be a successful investor.
For instance, the biggest investing mistake that you could ever make is to not invest at all, or to put off investing until later.
Make your money work for you – even if all you can spare is $20 a week to invest!
While not investing at all or putting off investing until later are big mistakes, investing before you are in the financial position to do so is another big mistake.
Get your current financial situation in order first, and then start stock market investing. For instance, get your credit cleaned up. Pay off high interest loans and credit cards. Put at least three months of living expenses in savings.
Once this is done, you are ready to start letting your money work for you.
Don’t invest to get rich quick. That is the riskiest type of investing that there is, and you will more than likely lose. If it was easy, everyone would be doing it!
Instead, invest for the long term, and have the patience to weather the storms and allow your money to grow. Only invest for the short term when you know
you will need the money in a short amount of time, and then stick with safe investments, such as certificates of deposit.
Don’t put all of your eggs into one basket. Scatter it around various types of investments for the best returns. Also, don’t move your money around too much.
Let it ride. Pick your investments carefully, invest your money, and allow it to grow. Don’t panic if the stock drops a few dollars. If the stock is stable, it will go back up.
A common mistake that a lot of people make is thinking that their investments in collectibles will really pay off. Again, if this were true, everyone would do it.
Don’t count on your Coke collection or your book collection to pay for your retirement years! Count on investments made with cold hard cash instead.