Hi there,
With the huge boom in number of ICOs and projects in the pipeline, it's becoming increasingly hard to discriminate between good projects and ones that will just go up in smoke. The key difference between investors that consistently back ICOs that gain, and those that end up with a patchier hit rate, I think, comes down to how much time they spend doing due dilligence, and how rigorous they are with it. To help anyone who is into ICO hunting and investing, I thought it might be worthwhile to list some of the questions I ask myself when I am researching - and some of the procedures I go through. I'd also be very grateful if anyone else could share their own tips - as I am by no means an expert, and I always like to be learning new things.
OK, so you have come across an interesting new ICO... so:
Key QuestionsFirst steps• Study the white paper, supporting documents
• GitHub repository - how active, how up to date?
• Can the idea behind the project be summed up in a 1 sentence elevator pitch? If not, it might be too convoluted.
• Determine is the idea viable and big enough to become something great?
• Ask yourself: does the project need to be done on Blockchain? Is it really necessary to create a new cryptocurrency for its work or is it just trying to jump on a trend? [thanks Porfenovich]
Team• Speak/contact directly with the development team - are they even reachable, how do they conduct themselves?
• The team – who are they, what’s their background, are they real people, what are their links to previous projects, people – good or bad?
• Where are they from? How positive is their native country's stance on crypto - how likely is a ban/regulation?
• Why are they doing this?
• What are their motives? What do they get out of it?
• What is their vision?
Use Case• Does it solve a real problem of any kind - or provide a service otherwise unavailable?
• Real-world usability and utility?
• Is it a product, system, infrastructure, currency, store of value, payment system?
• Is it a security – or will it be a security in the eyes of the law down the track?
• What purpose does an ICO serve or what functionality does the token have to give it potential for appreciation in purchasing power or utility?
• Will it be easily stores, secured, transferable and tradeable on major exchanges?
Network• What is the current network value?
• What is the future network value?
• What is the timeline for distribution and the likelihood of success?
• Is there a sufficient community behind it – or displaying growth of community?
• How decentralised is it really?
• Does it have widespread, mass market appeal to the ‘non-bitcoin’ person in the street?
ReviewsI'd then advocate getting some other opinions so it can be worth checking out scores on:
https://icorating.com/ico/?filter=upcominghttps://icobench.com/https://cryptorated.com/ico-reviews/Social Media and HypeYou can do some basic social media analysis just by hopping on Twitter and Facebook and looking at their accounts and the buzz. Also pays to check if they are running a bounty campaign here on BitCoinTalk.
If you'd like to do some slightly more advanced Social Media analysis, I wrote a tutorial on using Social Mention to do so here:
https://bitcointalk.org/index.php?topic=2955334.msg30331097#msg30331097So there we have it - I hope there something useful in there for aspiring ICO hunters. Please do share your own tips and process as that would likely help me - and I am by no means an expert.
