ICO, also known as Initial Coin Offering is a process of launching coins in the form of tokens to the public in exchange for cryptocurrencies or even fiat currencies. With its widespread speculation, it has become one of the easiest methods for startups to raise capital and attracting investors too.
Many Blockchain projects have raised millions of dollars through this method like Tezos, Qash, Paragon, to name a few. But as the saying goes, "Every coin has two sides", This puffery and buzz also attracted scammers like Prodeum, which has gone offline unannounced and left a nasty message behind on their said website.
Hence, it becomes highly inevitable to research and analyze yourself before you invest in any ICO. Below are some key factors, to help you avoid an illegitimate or fraudulent offering:
The Team behind the Project
It's of prime importance to know who's behind the project in which you're considering to invest. The founder, co-founder, advisors on the board, marketing, and legal staff, all play a vital role in an ICO's success. All the members must have enough experience and proper knowledge and skill set respective to their roles, to build the project. Visit the social media profiles of the team members and their pages to verify their genuineness and whether or not they've posted updates on their product.
ICO Whitepaper stating the Mission, Vision and Detailed Plan of the Project