How To Make Initial Coin Offering?

Initial Coin Offerings (ICO) News

by DailyCryptoInfo 300 Views

How To Make Initial Coin Offering?

Initial Coin Offerings (ICO) News

by DailyCryptoInfo 300 Views

1. Decide if an ICO is suitable for your business

If the only use for your coin is to trade on an exchange, it guarantees that the price will crash soon after the ICO takes place. Any token released during a campaign will come under tremendous speculation as soon as it hits the market. The only thing that can defend that is a strong demand for the token — a demand that can be produced by real utility.

2. Create a product

Spend your precious time building a solid, robust, secure, and scalable product on the blockchain, and only then tell us how it’s going to change the world. Perhaps you can get away with launching an MVP or beta and then conducting your token sale, but I think it’s safe to say that most startups will have to raise a little equity investment to get their business off the ground. It takes money to make money, and this is no exception.

How To Make Initial Coin Offering?

3. Create a token

Tokens are similar to shares of a company sold to investors in an IPO transaction.

Before creating anything, decide how much you want to raise, how many blockchain or ethereum tokens you will issue, how many you will retain for the team and sell within the Pre-ICO (if you decide to sell some of the tokens before the main ICO), and decide in advance in what scenario you will issue additional tokens.

There are several platforms — such as Ethereum and Waves — that allow you to create your own tokens without having to create a blockchain from scratch. The sale of these tokens is controlled by something called a smart contract, which is a computer program that directly controls the transfer of digital assets between parties under certain conditions

4. Get legal opinion

The objective here is to ensure that your token is not seen as a security and make it clear that there is no effort to deceive. Where the ICO really begins is in the pre-sale and legal planning process. To avoid trouble with the SEC, you will need a formal legal opinion and a legal description of the token offering and what investors actually get for it. Keep in mind that the legal aspects of launching an ICO may vary from country to country. Do your own due diligence to comply with all relevant laws and regulations.

5. Write a whitepaper

It wil ldescribe the problems it intends to solve, how it is going to address them, a description of the team, and a description of the token generation and distribution strategy. It is at once a pitch deck, a business plan, a marketing plan, and a technical manual. So why are many terrible whitepapers being published, you might ask? I can tell you from personal experience that writing a whitepaper is NOT easy. These are seriously complex documents and far too few teams are investing into proper writers and marketers for this component. Hiring vetted external writers can force the founders to be more rigorous and thorough, while bad vendors will cover up gaps in thinking or product inefficiencies with jargon and fluff.

How To Make Initial Coin Offering?

6. Create community and buzz

This is probably the second most important step in the ICO process. Your token sale will not get anywhere unless enough investors know about it. It is a sad but true fact that the majority of token sales are driven by initial hype. This hype, ideally, should be bolstered by a real community of investors that supports both you and your token, and will not sell at the first opportunity. There are several ICO marketing channels that I would suggest investing time and resources into:

ICO calendar sites like:

  • Reddit
  • Quora discussions
  • Slack & Telegram
  • LinkedIn professional groups
  • Facebook groups
  • Media coverage: Quality PR in the right media outlets will help establish credibility
  • Influencer marketing
  • Paid media

7. Get your token out on exchanges

You will need to reach out to ICO exchanges to carry your coin. Exchanges enable people to buy and sell your token on the open market, so getting it accepted on the strongest and most established exchanges is critical. Most tokens willalso be listed on CoinMarketCap, which is essentially a stock ticker of token sales. ICO’s that crash end up at the bottom of this large list or delisted entirely. The actual process of listing a coin on an exchange varies significantly by the site. Most exchanges like Bittrex and Poloniex strictly forbid tokens that could be considered a security. Submitting a request usually requires companies to present:

  • coin name
  • coin trading symbol
  • description of project and coin
  • coin logo
  • launch date
  • github link
  • source code reviewed by trusted third party
  • compliance fee (in some cases)