ICO Frequently Asked Questions
Despite the fact that ICO whitepapers have gained a lot of popularity in the past few years, many of the incipient companies venturing into an ICO do not seem to have all of the requisite information with regards to the same. This lack of knowledge allows for limitations to creep in within the system.
A set of ICO questions which makes its way through to the minds of the individual needs to be answered. We have been also familiarized with a set of common questions which our clients have while getting on with an ICO venture. These questions concerning the blockchain ICO have been duly addressed by us in the following section.
What is an ICO whitepaper and how do we write it?
Basically an ICO is referred to the fundraising programme for the company through the blockchain technology. The funds are raised by virtue of selling tokens in return of actual cash. These tokens can later be used to buy services associated with the platform. The ICO whitepaper definition in general would stand for a duly crafted prospectus which serves the reader with all of the essential information regarding the ICO.
An ICO is a vast concept and understanding all of the technical aspects regarding the ICO would be quite hectic and confusing to an average man. The ICO whitepaper is addressed towards the common public. It serves as a testament to the vision of the company, the purpose of the company and the company’s approach to the blockchain technology. A whitepaper is sort of a testament to the legitimacy of the company’s venture. When all of the integral concepts regarding the ICO development are explained to the public, people are assured of its legitimacy.
This in turn helps in gaining more clients and investors for the project since people are now convinced of the company’s venture and thus have a between trust quotient among them. Many expert crypto-enthusiasts envision ICO whitepapers as a means to elucidate the propositions of the company, the future plans, product development and their vision towards the integration of blockchain technology into the business.
What does an ICO stand for? What is a blockchain?
Well, there has been an evident misconception surrounding the fact that cryptocurrencies are completely non-regulated. As a matter of fact, owing to the number of fraud ICOs emerging in the market over the past few years, the crypto-currency ICOs of the modern times are expected to abide by a set of guidelines and regulations.
This scenario has been seen to have its inception in the US where the compliance to the regulatory guidelines is an absolute must for all the emerging ICOs. The US Securities and Exchange Commission also referred to as the US SEC has been of late determining the nature of the cryptocurrencies whereby they shall be declared as securities token or any other variant.
The test pattern which has been undertaken by the US SEC is commonly referred to as the financial regulations of ICO under the label of the United States. A quite similar scenario has also been witnessed in United Kingdom where the Financial Conduct Authority has been setting a set of premier guidelines that need to be followed by all of the emerging ICOs in the UK. Failure to abide by these guidelines can attract penalties or result in complete shutdown.
It would thus be ideal to state the fact that there are definite sets of guidelines that regulate the ICO agreements and cryptocurrencies. The only difference is the fact that these guidelines tend to be different across various countries throughout the world. Equity ICO token: One of the most significant benefits associated with an ICO is the proposition of equity ICO tokens. It can also be envisioned as a very promising application of Ether based smart contracts and blockchain technology. It provides the start-ups with the potential of providing utility stock/share tokens through the ICO programme.
The equity ICO token bridges the gap between start-up and their inception into the financial trading market. With the incorporation of the equity tokens into the ecosystem, the start-ups benefit in a significant manner owing to the fact that the entire concept of stock trading becomes transparent and more easily accessible to an average user. Essentially it allows the users to be deeply involved in the arena of “corporate governance” associated with the incipient company.
At present equity tokens are yet to take up a concrete role in the financial infrastructure of the company, but given the fact that it adds multiple dimensions of applications, the possibilities look pretty positive.
Are there any regulations for cryptocurrencies and ICO agreements?
It is to be noted that an ICO is a relatively new phenomenon in the present day market and many companies have very limited knowledge with respect to the same. However it needs to be treated as an integral assortment of the blockchain development ordeal.
The ICO first step is basically integrating the blockchain technology. Yes, the entire system is dysfunctional if the blockchain technology has not been integrated. The blockchain can be described as the primary step towards making the internet a transparent entity. It is a growing set of digital and cryptographic records which are highly secured in nature. The blockchain technology generally resists any form of tampering, modification and amendment of the data and is thus a secured distributed ledger.
How to invest in an ICO?
Before investing in an ICO it is important that the person understands and properly goes through their ICO Whitepaper. Generally this whitepaper contains all of the requisite information regarding the ICO, the cryptocurrency, the purpose of the project, the timeline of the project and much more.
Now while investing in cryptocurrencies, one needs to have access to the premier cryptocurrencies which include bitcoin and ether. These two cryptocurrencies in most cases are the ones exchanged in the ICO for the token of the emerging company. Once you have a stash of bitcoin or ether in your digital wallet, you are ready to participate in the upcoming ICO.
It needs to be noted that an ICO company may or may not ask you to register beforehand. Therefore reading the ICO info before the commencement of the programme is advised. Once you have access to ether or bitcoin in your wallet, send the requisite number of tokens to the ICO company address. Your participation is complete since the company now sends you your stash of tokens. The next thing that you need to do is store your tokens on the ideal platform. Using these tokens now you can make the use of the company services or simply store them for trading as assets later on.
How does an ICO work?
Any start-up company needs to have funds to initiate their programmes and aim for global expansion. At times earning these funds from conventional means can be slow and unethical. This is when an ICO comes into play. The companies engage ICO and attract buyers from various parts of the world that are interested in the company ventures.
In exchange of cryptocurrencies like Ether and Bitcoin, the companies provide the buyers with company tokens which they can use to gain the benefits of their services. The tokens are transferred on to the users at their unique address which is later stored in their wallet. These are secured digital tokens which are secured using the highest level of technology to ensure that the people do not lose their money.
The reason why companies exchange bitcoins and ether for their tokens is the fact that there is simply no bitcoin alternative in the present industry. It is the leading cryptocurrency which essentially powers the blockchain technology with Ethereum being its primary asset.
What is an ICO Calendar?
The ICO calendar is aimed towards ensuring that people have a one stop location for viewing all of the upcoming ICOs. The ICO calendar shows the real time valuations and development charts for all the designated ICOs. These can also be reviewed as performance charts which provides for a comprehensive insight into the performance of the ICO.
It would be better to refer the ICO calendar as a curated calendar which addresses token sales and alerts the user about them. It helps the people get alerts regarding the upcoming dates for the token sale so that they do not miss a chance of participating in them at all costs. It is especially beneficial to investors and crypto-enthusiasts that are on the lookout for upcoming and promising ICO projects.