Personally, regardless of what project it is, cryptos that have held private ICOs offering crazy bonuses/discounts to whales should not be taken with a high regard compared to cryptos that tries to ensure a wide distribution of coins to us normal investors. To create equal opportunity for the people rather than the super-wealthy, that is the spirit that all respectable cryptos should hold.
The trouble with ICOs.
For individuals that can overcome these problems, ICOs are the way into nascent projects. But here they're also at an extreme disadvantage next to Wall Street money.
Firstly you have all the scams. An individual typically doesn't get to meet project founders with an in-house technology expert at their side, but an institution can afford to vet each project thoroughly. Scams have siphoned hundreds of millions of dollars of individual investor money out of the market, and doubtless turned some people away from cryptocurrency permanently, while leaving institutional money untouched.
Secondly you have the trouble of pre-sales, coupled with the US regulations which restrict many token offerings to accredited investors and institutions only. These regulations are intended to protect retail investors, but in some ways have the opposite effect. Pre-sales can give big discounts to institutional investors, who can then flip a portion of their tokens to cover costs as soon as they hit the open market.
A company that buys in the pre-sale stage at 33% of the ICO price (not uncommon) can just sell off a third of their tokens once it hits the market. This covers their initial expenditure and still leaves them with a sizable investment in the project. It's a lot like free money.
Individuals, however, typically cannot do this. Pre-sales are usually restricted to institutions or wealthy individuals with the right connections, and the state of regulations in the USA means ICOs in general are increasingly off-limits to main street investors. In many cases, the average individual can only buy into a project once the token hits the market, at several times the price per token as an institution pays. This fundamentally changes entire risk to reward ratio. Main street and institutional investors can look at exactly the same project, and see a completely different projected return.
