How to avoid ICO scams
Initial coin offering (ICO) is a trend that has grown considerably over the years. However, it comes with downsides of its own in the sense that there is a large level of risk associated with it in the form of scams. The absence of authentic guidelines and protocols is one of the major factors that propagates the ICO scams. This does not mean all ICO’s are bad investments or scams. It just means that a whole lot of caution should be taken when one wants to invest in ICO’s.
To start with, a brief description of what the ICO is about can be seen HERE
WHY IS INVESTING IN ICO’S RISKY?
Globally, the ICO market is beginning to outdate the policies and regulations on the ground and as such, the ICO lacks appropriate regulations which increase the risk of falling into the hands of scammers.
HOW TO AVOID ICO SCAMS
As a potential investor in the ICO, you have to watch out for some warning flags when investing. For starters, you have to research extensively. There can never be more than enough research to do both before and after establishing yourself as an ICO investor. Websites like CoinSchedule ,CryptoSmile and CO Countdown amongst others help to track, examine upcoming ICO’s and when you are stumped, remember, Google always comes to the rescue.
Red flags to look out for!!!
- It is important to know that serious, legitimate and professional developers would not make preposterous claims about their products. So when you see an ICO that makes bogus claims on their whitepapers like how their product would surpass Bitcoin without any genuine evidence to back it up, take it as your cue to run away as fast as you can. Also, no serious developer or team of developers would make price predictions.
- It is important to also know the developers. Keep it in mind that names or pictures can easily be forged and manipulated so a little digging around to check the authenticity of the names given are necessary. You’ll also need to thoroughly vet the members of the team you’re looking to work with.
- Check out the whitepaper. Whitepapers essentially serve to explain how the ICO platforms work, what the project to be invested in is all about, how much money would be needed to carry out the venture, the interest rate that can be attained. If an ICO’s whitepaper is filled with little or no information about how it works or even with claims that don’t seem to be feasible, I would strongly advise you to steer clear of that platform.