Pillars of decentralization of ICO

The number of initial coin offering is rising rapidly with raise $ 5.6 billion in one year of 2018. Out of which most of the ICOs had failed which had been launched the previous years. Hundreds of ICOs is being launched every month, in addition to this dozen of mails reach Crypto Asset Management(CAM) from new startups who are planning to raise capitals through crypto tokens

Now let us explain what we call seven pillars of ICO investing. This was defined by several years for crypto investments and other investments in assets.

Team

The base for ICO investing is an effective team which is strong and has experience in developing and launching blockchain technology along with market that the investment is going to be done. An effective team must develop, execute and expand the reach the success of the project.
Some of the additional issues to be considered with the team are that
· It must have vesting token that will properly incentivize.
· The advisers in the team must have the right experience in the investing market
· The project must have financial backers like venture capitalists, macro funds etc

Idea

It is mandatory for a blockchain investment to have compelling, realistic and timely idea in-order to reach its success
Key factors for framing idea is
· The market must be large as possible
· The business must address an urgent problem i.e. product must fit into the market’s need.
· The project must stand out from the other projects or its competitor’s projects

Execution

Just a brilliant idea and along with a great team is not worth unless there is effective execution. Investments would be done only when there is a feasible prototype and a working model of the plan such that only if the product exists to some degree like Presearch, basic attention token, Superbloom, Fun fair.

Legal/regulatory

It is one essential pillar for the current and growing uncertainty in the industry.
Its observed that every week there is updates that there are regulatory actions or new statements around IPO governance taken by one country or another. Comprehensive regulations of many marketplaces of many countries are on the horizon and it should be given first priority to ensure that ICO vigilantly navigate their best in abilities.
The threshold of jurisdiction i.e. in what country the will the ICO company be incorporated and will be executed.

Tokenization
A successful ICO needs both strong monetary policy that will the project to success and a fair that token that is distributed across all the shareholders such that it maximizes the network value. Also for the success of ICO is the distribution allocation and network that allows the value of network to grow. In this case of decentralized system everyone who adds value to the network will see financial benefits.
It is an important thing that every investment we make must have is to have a legitimate reasons for tokenizing the business or project and also a public market must be created for the tokens to be sold.

ICO Structure

The financial foundations would determine the decision for an investment to be made.
ICO Structure can be split out into two categories

· ICO mechanics
ICOs need to have a convincing and compelling plan for use of proceeds as the return on investment decreases in proportion to the amount raised. The more relevant metric used here is token economy being valued. This valuation during circulation and release of tokens what we are being considered.

· ICO deal structure
The deal should be in way that the investor doesn’t feel the investment low. So considerations for deal structure are
o Distribution: the team must be in such a way that distribution of token, fair allocations among investors, advisors etc of the team.
o Distribution schedule: since crypto market is dynamic, distribution schedule must not favor for one side. Longer distribution can will be well suited for high potential ICO and individual liquidity preferences.
o Discounts: discounts are quiet common in ICO. This discount levels specified to some parts of the investments will allow the investor identify where they stand in relation to other stakeholders.
o Equity stakes: here they invest directly into equity that helps in growth and development of the company

Price Drivers

A token that has constant supply but doesn’t give any income for its hold is of no use and will project no buying pressure. Some price drivers are network volume, incentive to hold, supply changes, profit sharing, market leadership etc.