Hello Steemians,
This is my submission for the Steemit Crypto Academy task by professor @fredquantum and this week its about Investment through Private and Public Sales. Its such an interesting topic and here in this post, I am sharing my homework post for the same.
1. What can you say about Crypto Investment and how to properly utilize the investment tools available to make the right decisions?
Overview-
With any investment, the goal is the same that we need to get profit through the investment, and to achieve it we try to use various strategies. Crypto investment is a new aspect that we have now and its not too old. Its been a decade for crypto however last 5 years have been more important where more people have started investing in crypto. Its not like traditional investment and here we get completely digital platforms to invest and its easy to use. In traditional investment, we can get the historical data for long period but in crypto its not like that but provided tools are so advanced that help us do the analysis and conclude if the project is good enough to put our money. IN crypto there are two internal segments where people like to invest. One is bitcin and another is an altcoin. Some people only invest in bitcoin and they don't have an interest in altcoins however there is another segment of investors who are considering altcoins as a great part of crypto.
We don't have regulations in crypto, as we have in a traditional investment like stocks, real estate, mutual funds, and bank deposits, and these markets, are quite stable and mature but crypto is a new thing where we can see the lack of regulation in rypto space. The Crypto market is not mature as of now and its in a growing phase where we can see many countries and institutions are adopting it as one of the investment instruments.
Crypto investment is technologically quite advanced as there is hardly anything that required manual work and all the instruments are completely online. We have spot trading, future trade, DeFi, NFT tokens, etc and this provides quite a good variety for investors to park their money and gain better profit by applying their strategies. Crypto is not just limited for traders now and it has quite a vast portfolio of options whereas DeFi is the recent innovation which is given huge opportunities to investors who want to do risky investments. We can get a variety of options in DeFi out of which some are riskier and some are less risky but the kind of APR we can earn is rarely possible with traditional investment.
We have some tools that are very helpful to make the right decisions.
- Coingecko & CoinmarketCap
- Tradingview
Coingecko & CoinmarketCap
Both of the websites are so good and helpful in terms of providing information about any coin. I use both depending upon requirement however I rarely feel any difference in terms of information. The only difference is the UI so let's figure what help we can get from the portals and how it helps us to make the right decision.
This is the home page of the coinmarketcap website where we can see some important information in a glimpse which helps us to find out the overall market movement. As of now, coinmarketcap has 6594 coins listed on their portal and this list keeps on growing. There is plenty of information available on the coin page like coin circulating supply, daily, weekly, 52 weeks, and all-time high and low prices along with real-time price updates. We can also see the available market and coin pairs with crypto and fiat and even the volume on particular exchanges.
Here is the snapshot of the coingecko home page and we can see similar information here as well however it has slightly fewer coins listed than coin marketcap but this site has also become so popular in a short period.
For example, here I have taken ethereum and open the coin page where we can see the various information about the coin. We can see the current price, price change in 24 hours, trading volume in 24 hours, chart in USDT and BTC, market dominance, coin rank, and total market cap, etc. This information helps us to determine the project value and with this, we can make the right decision of investment. We get charts as well here but with limited options however, for a normal user, this is good enough.
ETH price is $3879.10 with an increase of 3.17% in the last 24 hours. Its rank is 2 as per the market cap and its value is 457 billion USD. In the last 24 hours, its low price was $3735.36 and higher is $3895.47 so this is how the tool is helping us with our investment decisions.
Tradingview
Tradingview website is more of technical and charting analysis and it provides the vast options to study the market using technical indicators. We can get a real-time chart and do technical analysis for crypto coins available from various exchanges and in different market pairs. It offers as well as paid version so one can go for as per the requirement and preference. Its more of technical analysis and a solid tool to understand the crypto market better.
2-Talk extensively about the following. Also, highlight the benefits and risks associated with each.
- Private Sale in Cryptocurrency.
- Presale in Cryptocurrency.
- Public Sale in Cryptocurrency.
1. Private Sale in Cryptocurrency.
This is the very first phase of any token before its launch in exchange. As the name itself says "private" as in this part of sale coins are given to strategic investors. Its a planning stage where development is still going on and developers are working to build the project and coin documentation like a whitepaper. At this state project team invite some institutions or big investors to fund the project and provide them the coins in a private sale. This is not open to the public and coin price is quite low in this phase of the sale. Usually in private sale coins are sold in exchange for leading crypto coins like bitcoin, ETH, or stable coin USDT, etc, and even with fiat wherever possible.
A certain number of coins are allocated in a private sale and this is a profitable situation for the project as well as investors because these funds help in project development and for investors, it brings a good value post the project launch. Funding is a very important part in the development phase and private sale is a way to raise funds without going in public that helps to boost the development.
Generally, such sales are not limited to one person or one institution and there can be many depending upon fund requirement and if things the planned way then the project gets enough funding to timely launch and for investors its a great opportunity to earn higher returns in a short period.
2. Presale in Cryptocurrency.
This is the second phase before the ICO offering and in this phase, coins are provided to a larger group of people. This is planned as per the white paper and here also a certain number of coins are made available to buy in the sale. In this phase, tho who could not buy in the private sale can be considered. At this stage project development is either finished or at the finish level that will not take too long to get available for the public. This is also known as the last phase of the ICO launch. Since this is targeted with a larger group of people and in this phase family or most the close friends are given chance to buy tokens. Sometimes this type of presale can be made available for the public as well as what certain limit of tokens purchases by each individual.
Generally in this stage coin price is higher as the project development part is finished so its possible to value the value and that's why the risk percentage is slightly low as compared to the previous sale. Sometimes more tokens are offered in pre-sale depending upon the coin supply and terms decided in the white paper but it varies from project to project and surely can't be the same for all the ICO projects. In this stage projects usually share the announcement in their website or media which creates hype in the market which is the planned strategy by the team.
3. Public Sale in Cryptocurrency.
This phase is also known as crowd sale because now coins are available for everyone and even in small quantities. Entire project information is now available public domain so that investors can read and evaluate the project before buying the coin in the public sale. Its imperative to provide the complete roadmap and vision of the project so that more people join the public sale and this is one of the stages where projects get more attention and hype in the market. Social media marketing is also done at a nice level in this phase to bring more people and nothing is hidden to gain the trust of investors. In this sale small or big both types of investors can be part of it and coin price is again slightly higher side as compared to the last 2 part of sales.
In most of the ICO projects at the stage, KYC is a requirement so investors have to go through the KYC documentation process. Since there are no limitations in terms of investors so coin price is relatively high and fewer bonuses or additional discounts are provided in this stage.
Advantage-
- There have been some ICOs that have given quite a big profit but the number of projects is too less.
- Higher profit in less time because before the listing usually coin price quite low and after the listing this coins can be sold to gain the returns
- Since coins are sold at a very low price so its an opportunity to earn more profit in short term.
- allows getting associated with the project before its launch which can be called founding investors. It also helps to get many additional benefits if the project does well and grows significantly.
Risk-
- Not every ICO is successful and in the past, the ICO success rate is quite low. There have also been so many scams where projects never got launched and investors lost their money.
- Although coins are given at a low price but still if the project gets delayed then it could become a loss-making situation.
- High risk involved because is under development and we can't predict the market repose before the launch.
3. What are the mediums used for Public/Pre/Public Sales in Cryptocurrency?
Different mediums are been used by founders or developers for different coin sales stages-
Social Media
This is one of the mediums that every project uses these days to spread awareness about the project and its upcoming sales. Twitter is the leading platform in this however I have seen projects advertising their projects in Facebook and some other alternate platforms too. This way project marketing team can reach more users in less time and its cost is much lower as compared to traditional advertising and marketing.
Meetings and Webinars
Meeting people in person and make them understand the project that encourages them to be part of the sale in the conventional method. Usually, projects try to schedule an event and meeting with a larger group of people so that in one time more people can be attended however these days because of the covid pandemic, the webinar has become a popular way where people can join virtually. Webinar cost is very low and things can happen with ease and some times AMA also helps to make more people part of the project by answering their questions and sharing the project insight.
Official Interactive Website
This is one of the important parts where usually project focus a lot and tye create an interactive website where all the information about the project, road map, phase of coin sales, burn events if any and plan, etc are updated. These days even after the meeting and other promotions people try to visit the website and gather more information before they invest and that's why its a very important medium. There is an option provided on the portal to buy coins using another crypto or even with fiat wherever possible.
LaunchPad
This is last but not the least and it helps to add more value in over sales. Binance is the biggest example that has a launchpad and any project sales that happen through Binance launch pad has been a great success so far. Generally, exchange listing is one of the parts that are now so clear but with the launchpad, there is one sure that the same exchange will list the coin so there will not be a situation where investors will not struggle with listing and option to sell the holding.
LaunchPad is used only when the public sale is opened because here everyone gets access to the token but its an effective way that makes the project successful as the exchange which is running launchpad have a huge number of users that helps the project to get a larger number of people buying the coin in the sale.
4. Research about any recent (2021) successful ICO or IEO and give detailed information about the project. (Note: BETA token is excluded).
I am sharing about COIN98 and it was launched on Binance Launchpad in July 2021.
Start Date- 16 July 2021
End Date- 23 July 2021
Coin 98 Project Overview-
This is a one-stop platform that aims to cater to uninterrupted demand become a gateway for DeFI users on multiple chains. It is built to provide everything that's needed including wallet, exchange, and cross-chain bridge for easy swapping or conversion. They have Coin98 Wallet, Coin98 Exchange, and Space Gate which is a cross-chain bridge.
Its native token is C98 and its designed to meet the growing demand for decentralized exchanges (DEX), swaps, staking & yield farming, etc. So the use case of C98 is quite good.
Coin 98 supports various chains including Solana, tron, BSC (Binance smart chains), Ethereum, etc. Its accessible through mobile and computer both and can support more than 25 networks.
Project Highlights-
This project has been successful and got more than 300k users in a short period. Its network has generated transaction volume worth over $220 mn with more than 500k transactions in number. Coin98 is built in a way that ensures the best prices for users for exchange services and also optimizes the transaction fee in a way that its not high and for that it uses various paths and algorithms to execute the transactions.
Always-connected-Coin98 multi-chain wallet engine allows users to manage assets on multiple blockchains simultaneously with one passphrase, creating a seamless experience when connecting to DEXs and numerous dApps.
Best Rates It gets fully automatic liquidity from multiple sources including Uniswap, SushiSwap, PancakeSwap, Quickswap, and MDEX, etc, and offers the best trading rates while keeping the slippage minimized.
Optimized Transaction Fee- It has implemented an advanced and optimized mechanism that allows users to save money and process transactions faster.
Great Ecosystem Experience It provides a single interface to all of the DeFi space including Wallet, Exchange, Markets, Portfolio Tracking, Multi-sig, Multi-send, and much more.
User-friendly: It makes DeFi services easily accessible to everyone with an easy-to-use user interface.
State-of-the-art Security- At coin98 users get control of all of their assets and information. Its protected by FaceID, Touch ID, PIN code on the mobile version, and matrix password on the web version.
C98 Token Sale Information-
Token Name: Coin98 (C98)
Launchpad Hard Cap: 3,750,000 USD
Hard Cap Per User: 20,000 USD (266,666.667 C98)
Total Token Supply: 1,000,000,000 C98
Total Tokens Allocated to Binance Launchpad: 50,000,000 (5% of Total Token Supply)
Token Sale Format: Subscription
Token Type: BEP20, ERC20
Supported Sessions: BNB only
Mode of Buy- Binance Launchpad
Lockup: No Lockup in tokens
Coin 98 Wallet
The wallet browser extension can be downloaded using this link
By accessing this chrome extension multiple chain wallet, users can manage their assets from different chains in a single wallet. This wallet can be connected to various DEX platforms and dapps to perform transactions. This works fast and is easy to use with a single password. By using this wallet users get a lower gas fee for the transactions and liquidity is not the problem at all because its works with various sources to provide uninterrupted liquidity. It uses smart ways to provide quick swaps with the best slippage and prices.
Coin98 DEX
Their other product is DEX and which has been launched in 4 phases. They have tried to add more services and functions with each phase and here is the information of services addition phase-wise.
- Phase 1- Single blockchain swap with manual liquidity
- Phase 2- Single blockchain swap but with a cross-chain bridge function
- Phase 3- Cross blockchain swap with dynamic liquidity provided.
- Phase 4- Added features like cross-chain bridge and automatic liquidity supply
Coin98 Token Economy
There are few aspects of the C98 token economy that can help us understand it better-
Development- Enitiure fee collected across the ecosystem is distributed between contributors which are helping the chain to create a self-sustainable network.
Staking Reward- liquidity providers are rewarded with C98 tokens to ensure enough supply.
Transaction fees- This fee is optimized in a way that users need to very less amount for the transaction and the C98 token is used across the network to pay the fee.
Governance- C98 token holding gives voting rights to the community provided they are meeting the minimum holding criteria.
5. Create an imaginary token. Write about the project including its use case. Develop an ICO which includes Private sales (3 stages) and Public sales (1). Note that: You are expected to explain what the funds are intended to be used for, your Private sale should have 3 stages, and specify the initial supply available, and the price you are issuing the token in each stage. Also, specify the price you are issuing the token at the Public sale phase (including the supply).
Fitness for Everyone (FFE)
Health and fitness are very important and my project is built to provide fitness services across the world. FFE token will be used to pay for all services including gym, fitness equipment, and everything related to health and fitness. The project is aiming to bring fitness centers on the blockchain and using FFE tokens users will be able to for monthly submissions as well and this will enable to pay them a certain % percentage of the discount.
Fitness For Everyone (FFE) is created to make the world fit and make the services easily available across the world. This will also encourage and enable the fitness sector to adopt blockchain technology and they need not do any infra set-up as the project will manage it all and this will charge a nominal fee. We will make the system easy to use for everyone and making payment will be instant. Some part of the fee will be paid to users if they pay by FFE tokens.
The project is built on a multi-chain protocol that with its compatibility on Tron, Binance Smart Chain, and Ethereum Blockchain networks.
Token economy and use case-
- Empower the fitness industry through blockchain technology.
- FFE token will be used to buy fitness services including equipment etc
- FFE token is the native coin and it will access across the ecosystem
- Listing will be done on leading international exchanges to make easy availability of liquidity
- Staking rewards will be provided to encourage the holding of tokens for investors.
- Mobile wallet and chrome extension wallet will be available for transaction
- There will be a discount if users choose the payment through the FFE token which will encourage users to use the payment method.
- Payment will be possible by scan and pay method so that users can pay with ease
- Mobile wallet will be fully functional with payment as well other features including staking etc so that users need not jump in various front ends.
There will be a total of 100 million tokens supply and out of that 20% (20 million) tokens will be offered to early investors through 3 private sales. These sales are private and before ICO. The project will follow different prices for tokens in a different phase of sales-
Pricing-
- Price of $0.20 in a private sale (first)
- Price of $0.30 in Private sale (Second)
- Price of $0.40 in Private Sale(Third)
Coin Distribution-
- 5 Million Tokens in first Private sale
- 5 Million tokens in the second Private Sale
- 10 Million Tokens in the third private sale
Now since the project is left with 80 million coins so there is a plan that will control the supply.
- 10 Million tokens will be reserved by the project to fund the project in case of expansion and this will be used only if there is more than 51% of governance voting.
- 25 Million tokens will be locked and 5 million tokens will be unlocked year on year in the next 5 years. This way project is trying to control the supply.
- There will be staking reward as well and this funding will be used from 5 million supply and the reward percentage will be decided by the governance voting and also depending upon the staking of tokens.
- 35 Million coins will be available for ICO
Token supply is an important part of the project and keeping a higher supply creates a situation where more people dump the token which destroys the token economy.
First Phase - Private sale
Date - 1st Dec 2021
Sale through - Project's Official website
FFE token price = $0.20
Token Supply = 5,000,000
Fund raised = $1,000,000
This fund will be used for project development including web portal, staff hiring, and office set up, etc. At this stage, we will also kick off the wallet development and reach out to fitness centers to make them aware of a project to get more visibility.
Second Phase Private sale
Date - 1 Jan 2022
Sale through - Project's Official website
FFE token price = $0.30
Token supply 5,000,000
Fund raised $15,00,000
This sale will help the project set up the required infrastructure and provide technological solutions to partners and users.
Third Phase Private sale
Date - 1 Jan 2022
Sale through - Project's Official website
FFE token price = $0.40
Token supply 10,000,000
Fund raised $4,000,000
Since the project has already gone through 3 privates sales so now there will be private sales and the next sale will be open which is the ICO of the project.
Public sale
Public sales will be open for everyone for 7 days
Sale through - Project's Official website
Date - 1st Feb 2022 to 7 Feb 2022
FFE token price = $0.50
Token supply 35,000,000
Fund raised $17,500,000
In Public sale (ICO) project is anticipating 17.5 million of funds and this is good enough to take the project forward. Since th project is built on a global front so this funding will help it to reach worldwide and provide fitness service to people.
The project would have everything in place before it goes for ICO and earlier sales had done nice fundraising which has helped to set up, team, office, development, marketing and portion, partnerships, and association with various fitness centers to launch the services on full fledge.
6. What are the criteria required for listing a token on CoinMarketCap? Are there criteria for listing an asset on a Centralized Exchange? If Yes, use an exchange for your explanation in response to the question.
Criteria required for listing a token on CoinMarketCap?
yes, some criteria must be followed for asset listing in CoinMarketCap and this process is completely online.
The application form can be accessed using the below link-
https://support.coinmarketcap.com/hc/en-us/requests/new
CoinMarketCap has mentioned that there is no other way than online for asset listing and the listing is done based on 3 principles which are Credibility, Verification, and Methodology.
CoinMarketCap warns that there is no fee and if someone reaches out for listing then its a scam and should not be provided any information. These days there are lots of such scams around so it becomes necessary to follow the instruction which can help to stay away from scammers. Its very important to follow the 3 principles while submitting the application for listing and as per the information coinmarketcap is very much particular about it.
- There must be cryptography, consensus algorithms or distributed ledgers, peer-to-peer technology, and/or smart contracts to function as a store of value, medium of exchange, unit of account, or decentralized application.
- There must be a functional website and block explorer.
- The asset must be available for trading in at least one exchange with volume and trading must be available for the public.
- A representative from the project must be there so that in case any communication or clarifications team can contact him.
- Request must be submitted through the online form provided in the coinmarketcap website with appropriate options selected.
- Correct information must be submitted on the form
If any coin is not listed under Tracked listing then CoinMarketCap lists the assets in some other categories as well and here are these categories-
Untracked listing This is one of the listings where assets are listed when it looks good based on the data provided but it does not meet the mentioned listing guidelines.
Unverified Listing - Asset is listed under this category when data is received but not verified by CoinMarketCap.
Inactive listing- If any asset is listed on the CoinMarketCap website but its not able to provide the data from any exchange which is supported by CoinMarketCap.
Tracked Listing-* When the project meets all the guidelines stated by the CMC website then listing falls under this category and it gets the entire information.
Criteria for listing an asset on a Centralized Exchange-
There are some guidelines and criteria for listing coins on any centralized exchange and I take Binance as an example here-
Link- https://www.binance.com/en/my/coin-apply
Application process
- The coin listing application must be filled and submitted through online form available on the website of Binance exchange.
- In Binance coins can be listed through a direct process and they have a launchpad service for listing which follows a different procedure.
- Direct listing is only for existing projects whereas Launch is for new projects.
- Entire information must be submitted correctly by an authorized person from the project so in case of communication Binace team can reach out.
Points to consider for listing
- Never contact Binance CEO or any contact person for coin listing.
- Never share white paper or any documents unless asked by the Binance team
- Accurate information must be provided and incorrect information can lead to listing rejection.
Listing Criteria
- Project must incorporate BNB and Binance stable coin BUSD in case of fundraiser as Binance expects the project to contribute for their native tokens.
- It must be an active project with a good amount of development and trading volume.
- Binance expects the project to support their community.
Listing Fee-
Centralized exchanges charge fees for the listing of any coin. Binance has shared an article for listing updated dates in the year 2018 where they mentioned that the 100% listing fee will be used for donation. Exchnage uses the fee to use in their charity initiative.
Here is the snapshot of the announcement where they indicated their charity and donation initiative. This is indeed a good decision and I appreciate it a lot.
Conclusion
In this lesson, learning about Investment through Private and Public Sales in crypto is very good, and learning full. There are various steps involved before any set is listed in exchange for public and most of the projects try to raise funds through private and pre-sales before ICO. usually, ICO is a good opportunity to earn nice returns but at the same time risk is also involved, and if the project does not do well then its a loss-making investment.
It was such a great experience to learn more about crypto investment through Private and Public Sales and thanks to the amazing professor @fredquantum for giving us this opportunity and I enjoyed the learning thoroughly.
Thank you so much
Thanks again to professor @fredquantum for this great lesson.