Investment through Private and Public Sales - Crypto Academy / S4W6 - Homework Post for @fredquantum | By @moohsin
Assalamualaikum,
Hello and welcome fellow steemians to my post. I am good and healthy and I hope so that you all are also good. Today I am posting again in @cryptoacademy. I hope that you all will like it and give some of your precious time to give it a read.
I have read the assignment given by Professor @fredquantum. He has very enormously described all the investment terms quite well and I am looking forward to giving my best in this homework post. So, let's get started.
What can you say about Crypto Investment and how to properly utilize the investment tools available to make the right decisions?
Cryptocurrency is the digital currency that is offered by different companies and stakeholders in exchange for some goods or services like content writing, data securing services, etc just like we got our salaries. But the most important expect of cryptocurrency is trading. Ever since trading digitalized and people started selling their properties, goods, and skills online so basically there is a need for digital currency grew up which was further accomplished by introducing many cryptocurrencies like Bitcoin, Ethereum, BNB, and many more. Right now, there are more than 10,000 cryptocurrencies listed on different trading platforms which can either be traded or get through reward or by mining.
But the important thing is that how can we invest in it and how much?
Cryptocurrencies are relatively easiest to get invested and it is also the most reliable source as compared to the banking system across the world but it is more volatile and base on many short terms and long term projects. So, before investing in cryptocurrency traders' must have the acknowledgment of the market and projects of cryptocurrency.
In addition, there are several ways of investing like trading, holding, mining and there are also many new ways to invest in crypto. It is a decentralized system so the government has no power over the prices or any other resources of coins. All the transactions are traceable, secured, and publicly stored.
Cryptocurrencies are somehow very famous for their immense profit rate but people will lose their 50% stock easily if they didn't act according to the rules specified for trading crypto assets. There are generally three types of analysis traders must do before investing in any cryptocurrency.
- Fundamental Analysis.
- Technical Analysis.
- Sentimental Analysis.
Fundamental Analysis:
Before indulging in a trade, First, we have to test the historic view of the following product by doing a fundamental analysis. Like, What kind of project it is based on? and what is the market cap of coin and total supply etc. There are many platforms here that help us in doing fundamental analysis more deeply and accurately in which coinMarketcap and coingecko tops the list.
- We can see that I have chosen Cardano token here at coingecko and it appears that it provides me all the recent data and historical data so that I have not any difficulty in pursuance of all the news regarding this coin.
Technical Analysis:
In contrast to fundamental analysis, Technical analysis has taken place in which investors' read the chart of the asset and also predict the future price through it. Technical analysis is very useful as it indicates the market movement more efficiently. There are many trading platforms where we can search any coin of our desire and observe the chart of the asset but the most popular site for technical analysis is Tradingview which has the widest variety of technical analysis tools.
Sentimental Analysis:
Sentimental analysis can be done through a very outstanding Fear and Greed Index tool which gives the interaction of market that either trader is afraid to trade or too greedy. It provides a signal from 0 to 100 in which 0 is for extreme fear and 100 is for extreme greed.
- In the above screenshot fear and greed index shows the emotion of the Bitcoin market and it is in a greed zone which means that at that point traders having some handsome profit and the market is in a soar.
- This Index is available on many websites like coinMarketcap and coingecko and Tradingview
Talk extensively about the following. Also, highlight the benefits and risks associated with each.
i. Private Sale in Cryptocurrency.
ii. Presale in Cryptocurrency.
iii. Public Sale in Cryptocurrency.
Private sale in Cryptocurrency:
Private sale is the first step of initial offerings where different verified investors call up and they will be presented with the plan and structure of the token and briefly described the projects of this token, after that these investors took an in-depth view of these tokens and examine them on their problems and then discuss their issues and concerns over that token. These tokens are presented to these investors at a very low cost and at that point, the token doesn't list at any platform.
The funds generated from the private sales are used in the completion of ongoing projects of this token. Founders also urge investors to invest through other different coins like BTC, ETH, or TetherUSD, etc which gain their chances to be in the market with the correlation of these coins.
Different platforms force founders to get their token pair with their coin in order to get an investment through their platform like Binance, Tron, etc. Through initial offerings, investors can have immense profit afterward when the token enlist on the trading platform but sometimes things not always went in the direction we choose and we have to face a loss too.
Presale In Cryptocurrency:
This is the second phase in launching an ICO. Compared to private sales, in this phase coin is offered to a relatively large number of people or groups for investment. In this phase, the token is offered at a slightly more price than the private sale price. The sales in this phase made the private investors more confident about the project. The plan and structure of the token are completed in this stage and the project is near to its completion.
This phase is less risky and more vulnerable because buyers can analyze the token because many parts of the token were completed. Also, till that point, the token also appears in chart form through which we can analyze the technical weightage of the token, and also the working of founders and developers can be examined through it.
But undermining all the advantages there is always a risk of token falling short of investment after presale and in many cases, it can be seen that many projects did not perform well or taken more time than given because of new competitors and investment problems.
Public sale in cryptocurrency:
Public sale is the last step of fundraising programs for any founder where he pull out all resources like media, complaining, and advertisements where not a particular audience but public is the target. In this stage there are chances to get maximum funds more than pre and private sales because discount in public sale is less than pre and private sales and more small investors attract towards it because the project is nearly completed and token will be listed shortly or even listed.
This sale increase the volatility of that token and it became more easy to analyze the price of the token when available in the market. This stage proves that the token is not potentially a scam but a reasonable project due to which many people prefer to invest in this stage because it is less riskier than the above two stages.
By investing in public sales it is more chance that the investor could have less profit due to the buying price of the asset and it is also possible that the product will not perform as expected when listed on the trading platform.
What are the mediums used for Public/Pre/Public Sales in Cryptocurrency?
There are many mediums founders used to launch their product but these three are main mediums as follows,
- launchpads
- Developers Website
- Social media handle's
Launchpads:
This usually comes after three steps private/pre/public sales of cryptocurrencies in which founders uses different exchanges launchpad to launch their product in the market. It is also the most reliable and fundamental source for investors because on exchanges their is a very little chance that any scam product is listed.
There are many launchpads currently working out of which The Qube Launchpad, TrustSwap Launchpad and Binance launchpad's stand tall to help fundraisers by giving them a wider space in the market to flourish.
Binance Launchpad provides founders and developers a medium to host their private/pre/public sale and users commit BNB and in return gets the new tokens. When we participate in a launch sale we first have to commit some existing tokens and it is more likely to be BNB and BUSD so that when the token gets a strong stance in the market, Binance coin also took a soar with it.
During distribution of the new tokens, you get the new tokens based on the percentage of your commitment to the total commitments of all investors combined.
The formula is,
(Individual Commitments / Total Commitments) x Total amount of the new tokens offered on Launchpad
Developer's Website:
It is also the most straight forward and easy method used by founders by directly sell their coins through a website. The ICO's mostly depend on the other coin like BTC, ETH and BNB, etc. But there is more chances of fraud so we first entirely check the accounts of owners before getting in with our money.
Social Media Handles:
This is also a very popular method where founders advertise their product hence, attracts a large audience and urgs them to pay in fiat as well as crypto like BTC, ETH etc. They also made applications to get their audience on a page and introduce different reward systems or exchange through Fiat or Cypto.
Research about any recent (2021) successful ICO or IEO and give detailed information about the project. (Note: BETA token is excluded).
In this question I am going to review Barcelona fan token (BAR) as I am also a fan of the club. The coin is listed on 24 June 2020 on Binance platform. Basically fan tokens of different clubs and teams are made to run through a project of CHILLIZ which is called as Socios.com. Socios is able to get many football clubs, cricket teams and basketball teams to have their own fan token. These fan tokens were acquired by fans of the following clubs and teams. The token holders can participate in different club activities but also have an influence on many decisions. They also called up for the tour of the stadium and club's museum where they can have a chance to meet with their favourite players.
- The BAR coin is made on Ethereum blockchain as a proof-of-authority sidechain of Ethereum.
| Hard Cap | 2,000,000 USD |
|---|---|
| Total Token Supply | 40,000,000 BAR |
| Current Circulating Supply | 7.4% of total supply |
| Discount Sale Price | 1 BAR = 0.04512816 BNB (26.761 USD, using a BNB price of 593 USD) |
| Tokens Offered | 74,735 BAR |
| Token Type | Chiliz Chain Token |
- In the above picture, the all-time running of Barcelona fan token is shown. The price at which the coin is listed is at 6.3$ but it did not perform well in the initial phase but afterwards it went as high as 54$ and also at the all-time high at79.26$ which is nearly 594.38% of the initial price, just consider that those fans who were hold that token had an immense profit.
If we talk about the total circulating supply which is 3,550,992 BAR out of 40,000,000 BAR which is total supply. These fan tokens brought a new joy and realism to the game and now fans are more involve with the club activities then ever before. This step is no doubt a revolutionary which will completely change the club structure of taking decisions because now more and more fans are involved in club activities.
So, if we involve in the private/pre/public sales of these coins it has more chance that these type of coins will be profitable because they already have a targeted audience who are ready to buy fan tokens at any cost.
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).
Research Token
We are going to launch a Research Token which will help researchers and students to publish their research work on our platform so that they can be rewarded through a rewarding system based on their work on research. This token ispurely decentralized and works as curation system which is non-custodial
Yes! there are questions that how will it attracts the local audience towards itself and what type of research it approves. The answer is that research of any kind or any label can be approved. Like if you did a research on honey bee comb in your area that when you saw it and from how long it be there or how big it. Of course, this is the easiest one but some professional work can get you bigger and better reward.
It is built on a multi-chain token protocol that sees its compatibility with TRC, ETH, and BSC Blockchain systems. In its launch, there are plans to be listed in trading pairs with BTC, ETH, BNB, and USDT for improved liquidity and acceptability. With the help of David Robust, a popular researcher we will be able to get the attention of many people towards our platform and we decided to have private sale of original content with discounted prices.
The private sales are taken place in three steps and then a public sale is taken with different pricing techniques for the fundraising of this project.
We have a total supply of 10,000,00.00 RES tokens and we are going to offer 25% at every sale.
Date: 10 - October - 2021
Website: Researchgo.com
Reward: 1$ / Reasearch content
Supply : 10 % of total supply = 100,000.00M
Expected value at the end of sale: $100,000.00
Date: 11 - October - 2021
Website: Researchgo.com
Reward: 0.8$ / Reasearch content
Supply : 10 % of total supply = 100,000.00M
Expected value at the end of sale: $80,000.00
Date: 12 - October - 2021
Website: Researchgo.com
Reward: 0.6$ / Reasearch content
Supply : 10 % of total supply = 100,000.00M
Expected value at the end of sale: $60,000.00
Date: 14 - October - 2021
Website: Researchgo.com
Reward: 0.5$ / Reasearch content
Supply : 20 % of total supply = 200,000.00M
Expected value at the end of sale: $100,000.00
After all the sales taken place the generated funds are between $340,000.00 which is the value of 50% of total supply and these funds will be use in the completion of different projects on this platform.
What are the criteria required for listing a token on CoinMarketCap. Is there a criteria for listing an asset on a Centralized Exchange? If Yes, use an exchange for your explanation in response to the question.
Listing On CoinMarketCap:
The online submission form is the only way to give our application to list any token on coinmarketcap. The main points before submitting an application are as follows,
- All the information are well stated, verifiable, and understandable.
- Application must be submitted through the provided link i.e "add new asset".
- All the communication regarding token must not be spam or repeated.
Tracked listing:
The token must have leverage cryptography, consensus algorithms or distributed ledgers, peer-to-peer technology and any medium of exchange or decentralized platform for the exchange of token.
It must have a block explorer and functional website.
It has to be traded on at least one exchange and have the record on coinmarketcap.
There always a representative available for coinmarketcap teams in order to solve any query.
Untracked Listing:
If the token does not meet the criteria of coinmarketcap evaluation framework then it can not be listed there or tagged as untracked listing.
Delisting Policy:
Coinmarketcap have the right to delist any token without any prior notice or information. The possible causes of delisting are given as,
Low network rate or suspicious activities.
The project was enlisted due to misleading or wrong information(these cases are very rarely to occur).
- Project failure or project have no audience as expected.
For more info regarding listing policies visit coinmarketcap listing criteria.
Listing On Centralized Exchange:
In order to list our token on Huobi Global we have to follow some basic instructions.
- Documents are well stated and complete.
- Lack of team quality and less attention towards community is unacceptable.
- All the projects must have a visual support and technical application.
- When asked for information like White paper, progress report and periodic development must be available and reported in a respective manner.
Delisting Policy:
If project team trigger any of the following conditions they can be delisted without notice or public announcement by Huobi Global teams,
- If the project team fails to submit weekly report on consecutive eight weeks.
- Projects allegdelly found in any illegal proceedings like fraud or money laundering etc.
- project teams allegdelly found out to operate the market which bears serious results.
- The marketing or publicity damages the reputation of Huobi Global by any means.
- Dissolvation of project team or changing of team member without any sustainable reason.
Conclusion:
Through private/pre/public sales the investors can get much more profit on short/long terms or in some cases by holding the asset is helpful. But the investments at these point comes with much more risks. In order to eliminate those risks, investors must have to study and analyze the team and projects of the token.
Through this lecture, we have now better understanding of listing of tokens and how to invest in these tokens and all these aspects would be helpful in our future trading.
In the end, I want to thank @fredquantum for this useful and in-depth knowledgeful lecture about private and public sales and also thankful to @cryptoacademy for this amazing series of courses.
@fredquantum