Bitcoin Forum

It seems most ICOs fall below their ICO price shortly after they're listed on an exchange. This seems to be mostly due to pre-sale bonus investors and bounty hunters selling off their tokens rather than panicked ICO investors. I think it is far more ethical for new project teams to pay bounties in BTC/ETH rather than their token, and to not allow huge pre-sale bonuses, as both these things in my eye corrupt the value of a token. I've decided I'll no longer join any ICOs that utilize either of the above two practices.

If you've invested in a few ICOs, then I'm interested in hearing your thoughts.

As long as the project has reserved enough tokens for during the token sale over the bounty campaigns, it should be just fine. Most of the projects these days give a lot of attention to token distribution making sure it goes perfectly even and not to give out too much through bounty campaigns which could cause a drastic crash if dumped. Any ICO giving out more than 5% to bounties could face the dump factor as most of the users who attain tokens from bounties tend to dump in instantly at any exchange for the highest possible price.

I think is not because the token allocation for a bounty campaign is only about 1% only, a very small value.

Well it depends

As most of the ICO took out 1% of raised fund towards bounty, IMO this is good because 1% would perhaps affect a bit but wont "Crash" the price :)

yes I agree with you, the allocation of funds for bounty is usually only 1%, so it does not really affect the price of coin in the market, but what makes the coin is down is the holders of coin presale ico and ico, they mostly sell the coin immediately after entering the exchange.

The percentages of tokens dedicated to bounties are usually vey low so the dumping you see most of the times when ICO tokens hit the exchanges is due to the low demand combined with panic sellers. There are so many ICOs in the past months that money is more spread and only the most hyped ICOs will do well after they hit the exchanges because demand will follow trough after the ICO ends and more investors will want to buy it.

As a person who has participated in a few bounties till now, I assure you that bounty people never dump their coins in haste. If you look at it this way, mostly bounty tokens are distributed after 2-4 weeks or normal token distribution. So by this time the token has mostly made its own price range between which it trades. Also bounty tokens are only a very less percentage of total distribution, so they cannot lead to dumping of prices.

Being listed on exchanges rarely happens immediately after the token distribution date. It usually takes several weeks to get listed as far as I know, so bounty people still have an opportunity. :D


I think so too. Actually, the total bounty pool of an ICO is hardly more than 2%. I have met 1% in most cases, and the ranges 0.5-1.5%. So that's not likely to be a big deal anyway.

Each project that has a bounty allocates a certain amount of their tokens for bounty. Many of the people who are obtaining the bounties can obviously dump as soon as the coins hit an exchange but the total bounty allocation is usually very small. It is worth asking the team if it's not stated on their ANN so you can factor this into any investing decisions but I don't think it's a large factor. Also, people often put in work for bounties and many of them believe in the projects and hold long term.

Why do you think about these things anyway?
If you invest in ICO it means you are not going to sell it ASAP, you are investing in long term because you believe that project will be successful and you will get your shares every month, bounty dumpers shouldn't bother you at all.

I don't buy the idea because I participated in an ICO that worth 1USD per token, the token hits market at 70 cents, some investors dump the coin at 59 cent. In a way both bounty hunters and investors contribute to low price when coin hits exchange.

yeah bro.i think so too.the bounty percentages is too small to affect the price movement and beside not all bounty participants sell their coins.some do hold it.but the outrageous bonuses some ico gives pre-sale investors is another matter.that might be a factor and another reason is the investors orientation. Most ico investor are not in it for the good of the project but just to cash out when the price rises by a certain % and moves on to the next one.

The truth is that we must be ready for all capabilities. Sometimes investors understate ICO price and sometimes this same thing doing bounty hunters.

So i recommend it but you must be careful

Developers of the new cyrpto-currencies are using bounty programs to promote their project. Maybe some people who are obtaining the bounties can dump the price of the coin when it hits an exhange. But if they make a good plan for their bounty programs; it wouldn't be harmful for the future price of their new coin. Just my opinion.

Yes they can if all of them sell immediately but it is not important because it means that there are buyers so the coin is actually valuable.

You need expert opinion form, what do you think about the decentralized e-Chat application? How strong is it in the market?

Not always. It depends on how much was given away and how many want to dump. If the project is good and has a great team then it should stay stable and you would be foolish to sell.

I do not think that bounty hunters can significantly lower the price because they have a very small percentage of the total amount of coins

I think yes. Because usually when they pay the bounties, volume in exchanges for that coin usually is very low. So small amount of sells even effects on price.

I agree with you, that bounties could cause price dumping under some circumstances, mostly when new cryptocurrencies/tokens don't come with a serious project. But they offer a great way to get many people familiar with new promisible projects. So much experience in marketing, development and innovative projects are needed for the success of new cryptos.

If a bounty is set at a reasonable price, then there is not a problem. If the bounty takes 3-4% of the token pool, then the project would appear scammy.

This thing i would supposed to say too which the bounty allocation is just 1% which it can really affect the price if all bounty haunters would decide their tokens.If you are an investor of a certain ICO you would really got worried but eventually theres really always a point on where a certain coin do hype up for one time which would definitely surpass on ICO price and as an investor you should really keep an eye on this opportunity for you to sell out and secure profits.

Interesting replies thanks. I guess that's true if the bounty is in the 1-2% range the bounty hunters are not really effecting the price. I agree I'm mostly likely wrong about that. Perhaps it's mostly pre-sale bonus investors, which seems to be a far bigger issue. I've invested in about 10 ICOs so far and all of them have fallen below ICO price within a month of the ICO, particularly on Etherdelta. It's just hard to imagine panicked investors are always selling at a loss so quickly. Where do you think the dumping is coming from? I think it must be the pre-sale bonus investors arbitraging their bonus %. And even just 10 or so whales doing this is enough to provide high volume to manipulate the price below ICO price for a long time.

Pre-sale bonuses for whales seems quite unethical since ordinary retail investors who provide the majority of the capital during the main ICO are penalized the most, whereas those who pick up the token cheaper on an exchange a month later who didn't take that initial risk (and provided no capital to the team) are rewarded with cheaper tokens. Most recent ICO was Black Moon Crypto. That was heavily hyped and sold out within an hour or so, now it's trading less than ICO price. Actually the BMC team seems very good though since they're doing a buyback of tokens at 80% of the ICO price, which is a very nice move to limit the loss to ICO investors which Ir espect. Without that the price would probably be much lower right now. But still, the fact remains its below ICO price. Another big ICO was Aventus that sold out within minutes, also now below ICO price. I didn't invest in Paragon Coin since the bonuses on that were ridiculous, it is obvious it will be dumped far below ICO price when it hits exchanges.

As someone mentioned, with a long term holding approach none of this should even matter. And I agree. Nevertheless, even for long term holding it seems wiser to buy tokens after they hit exchanges rather than through the ICOs. As I say out of the 10 or say ICOs I've invested in, all of them are trading below ICO price (unfortunately I got in after the early August boom).

I think as investors it's wise not to participate in ICOs but rather to buy up the tokens after the pre-sale whales do their exchange dumps. And if enough retail investors realize this perhaps project teams might start losing ICO funding and stop issuing ridiculously high "pre sale" bonuses to whales. Or is my thinking completely off here?

No, because usually the allocation for the bounty hunter is only about 0.25% - 2.5% of the total sales of ICO which means very small. And I know a lot of projects that implement Bounty Campaign and become successful because the marketing they do more widely reach. Precisely Bounty Hunters benefit ICO organizers.

Nope, bounty only has a small % of the total market cap and crash are basically caused by the bonuses the investors get which they usually sell to gain ROI.

it's true a lot of altcoin nasty price after entering the exchanger because it always experienced a dumper by the hunters of the prize so they decreased to much below the ico price. maybe i will also think the same thing with you.

Just thinking out loud after reading all the information here.  If Airdrops and Bounties can kill the ICO so quickly, why not use different wallets for each activity.  What I mean for example is any investor uses/receives an ETH wallet.  All Airdrop and Bounty participants must use a Wave wallet.  Then just limit the number of tokens that can be dumped in a given timeframe from the Wave wallet.  There has to be a way to prevent the destruction of the ICO.  Like I said just thinking out loud.

Yes, altcoins bounties do probably crash the ICO price for all the reasons you've listed.
That's why I rarely invest in ico's anymore. But I keep my bounties in the long term (often a year or more) and then it pays off quite well, most of the time.

It's not small as you said, if that based on the total supply and i think you should consider it as a large amount for the bounty but if that bounty based from the total token should and the amount of bounty should be reduced every time.

From my point of view the before and after is the creation of etherdelta as a decentralized exchange. before you waited for it to come out in an exchange with volume, and on the first day of leaving the token to trade in any decent exchange there was an injection of liquidity that triggered the price up. the difficulty of managing etherdelta added to the little volume and that the speculation is already underway for a definite time until a good exchange comes out, makes the euphoria of buying diminish and you lose those cravings to buy

I think yes,  the price crash due to the alot of airdrops and bonus,  but airdrops is necessary to advertise the coin,  if the coin got a good project and clear vision,  it wont be a problem,  the price will eventually recover and become better,  so don't worry if you enter ICO and see the price fall down the moment entering the exchanger and the price is lower than it was expected from the coin developer

sometimes investors need quick money and quick profit in their mind,, or they have a new good ICO/project and want to make another investments
and investors will sell the coin or token that they buy on ICO's after listed on exchange,
bounty hunters can affected the price but not much

Maybe yes because some bounty hunters are eager to sell their bounty tokens after they receive it and this can lead to dump the value of that coin.

Yes it does but depending on the coin, it will recover fairly quickly.  Usually most bounty hunters (not all) just cash out of their earning in the respective currency that they worked for and trade for bitcoins at the end of the campaign.  Usually the dump occurs when they dont input a sell order but usually go with the highest bid for that particular coin.

only 1% for bounty. dont think its has a effect to the market value. people used to blame the bounty hunter cause their wreck the market value.  my points is its only 1% and not all bounty hunter dump their coin so i guess its below 1%. i agree there might affect the market but its not so extent.

Yes, but somehow you can't blame bounties for that. Anyways, look at the brighter side you can buy cheap coins/ token from dumpsters which are mostly coming from bounties .

I think the price of token  fall below the ICO price indeed because a big bonus, with a big bonus the investor will soon sell it when listed on exchange because they felt was getting enough profit. But this depends also on the fundamentals of the project, if from a fundamentally good point, it is likely that the price will rise above the ICO price. And for bounty campaign I think only about 1-3% not really effect the price of token.

Your suggestion is good BTC or Ether is the rewards given to bounty hunters. But because it's a fix that people might want to join the ICOs to invest or even help to expand their company further. Many as well as bounty hunters will not tolerate such a system so if it's possible that ICOs will no longer be interested in people.

the bounties hunters always be sold their coin and they even do not to concern for the future of those coin as long as they can cashed the coin from bounties program then probably they will forgot it and move away to find another bounties so my answers is yes it also the cause why sometimes the price after listed to the exchange will dropped at below of ICO price but you can decrease that risk with only allocate small percentages for bounties program

a large volume can pave on the price. so they will be better off, but the price will grow on them and not lose value ::)

I don't think it has that much of an influence,  bountie allocation is just a few percent of the total supply.
And if it does have an effect in some cases, if the project is good it will find it's way to the top regardless.

Not really, the idea that bounties are crashing the price is a convenient myth, bounty hunters become a sort of scapegoats for a phenomenon which has other causes.

I don’t think Bounty payment will crash the price of a project. Sometimes the price crashed even before bounty payment is paid to the participants.

I feel that it is some whales that are manipulating the price by pushing it low and buy cheap. Just my 2 Satoshi.