Before proceeding into anything related to ICO or any of its facts, let’s get to know what an ICO means. First of all, the term ICO is a short form for Initial Coin Offering. It is generally known as the initial placement of coins or tokens during any type of process. During the processes involved in an ICO, the project team distributes digital tokens as a type of commodity or product. Sometimes, an ICO is also used for the authorization or proposition of money among investors in a trade. The coins or tokens generated in an ICO process are later used in various platforms that include projects, trade exchange, and several other things.
To know more about ICO and what does it stand for, follow this link, https://crypto-wikipedia.com/.
How does ICO attract investors into its processes?
There is a very simple process through which investors can invest their money into ICO. The first thing that is involved in the ICO process is the right calculation of monetary value. This monetary value is based upon the current value and the value that will be finalized in the succeeding years from the current date. If the currency’s value has higher rates of increase in the succeeding years, the benefit lies here. For example, in the cryptocurrency Bitcoin, in 2009, its value was calculated to be null, but in the current year, the value has risen to be over $9000.
What risks are involved in investing with ICO?
Like any other money investing platform, be it in terms of real currency or digital tokens, frauds can be the most common type of risk that one can face. Frauds generally happen when creators intend to collect their user’s money. And since there is very minimum regulation to cryptocurrency and digital tokens, the levels of fraud are seen to be generally high.