If crypto currency is decentralized, how can the developers release initial coins, does that mean they have manually gone and mined millions of coins into a wallet to release for sale? If not then how can a developer control the release of coins and does that pose a risk to investors if this person has overall control?
cryptocurrencies are just computer codes! they have some initial constants that you can simply change to whatever you like. also not all coins are being mined. there are very different methods of distribution one of which is mining.
we call this a pre-mine. the developer simply creates that amount of coins out of thin air in the first block. it can be all of the coins in circulation like ByteBall, or it can be all of the coins in circulation by that time like the 72 million premine of Ethereum.
then comes the distribution. i personally dislike this method of distributing the coins but it exists. for example Byteball is distributing it based on how much bitcoin and GBYTE you own.
the risks usually depend on the project itself for the most part and then the way they distribute the coins.
How can I analyze risk rating of coins, is a coin with a low price and low market cap considered high risk? or should I be looking for coins with a large market cap and low price?
all altcoins are high risk no matter how low or high their price or market cap are.
the coins with a higher volume and bigger market may move slower but they are still risky.
you can see the number 2 coin (ether) had its official multisig wallet hacked multiple times now and people lost millions of dollars worth of it every time!