LIST: How to evaluate ICO opportunities

[bayu7adi]

in my opinion, the first is understanding the website. only takes 3 minutes

then discussed in the telegram about 30 minutes to find out the developer more closely

and read whitepapers and other supporting documents for about 30 minutes

and lastly I will visit ICOBENCH.COM to find out the rating of expert blockchain

[Kristen_Colwell]

in my opinion, the first is understanding the website. only takes 3 minutes

then discussed in the telegram about 30 minutes to find out the developer more closely

and read whitepapers and other supporting documents for about 30 minutes

and lastly I will visit ICOBENCH.COM to find out the rating of expert blockchain

Thank you! Sounds like an efficient process. I'm guessing you are no new kid on the crypto block.

You watch the martial arts master move effortlessly through complicated, powerful movements without breaking a sweat. You ask the master, "how do you do that?!" Master replies, "I do nothing."

 

Best,

Crypto-Kristen

[panghae]

Hi all,

I'm working this list of factors to consider when evaluating an ICO for investment. This is a LIVING LIST, and I'm seeking input so that I can create a public checklist of sorts. Share your thoughts!

I'll constantly update the questions on this list based on new information. Ultimately, we should be able to evaluate an ICO opportunity by working through the checklist. See the end of the list for sources...there will be many in addition to the feedback I get here.

One list to rule them all!!!

SO, first step was getting the sections down. Now, I am reviewing ICO evaluation articles and adding relevant questions to the sections below:

Evaluating ICO Opportunities

1. Token Purpose: what need does the token address?

• Is the token new and no other token offers the same service?
• Does the token have a clear purpose?
• How broad or narrowly defined are the use cases for this blockchain?
• Does the token provide return to token holders?
• Does the token reward users for contributing resources towards the creation of a shared service that will benefit all users?
• Can the resources contributed by users be verified by anyone?
• Does the token align incentives to simultaneously accelerate growth and token value?
• Who will support the token?
• Is the token structured with centralized control or a decentralized governance?
• Is the token a utility token (usage token or work token) a security token, or a combination?
• For usage tokens: is the digital service being offered useful and does the network underlying the digital service aggregate resources (hashing power, file storage, etc.) that will differentiate the service in the long-term?
• For work tokens: is there a strong network emerging that wants to contribute and is the UX well thought through? And is the service offered useful to people?
• For security tokens: is there some technology underlying the security that gives the token a long-term competitive advantage?

2. Competitive Analysis (SWOT): is this unique in some way?

• Does the project benefit from being on the blockchain? Should it be on the blockchain?
• Can the company successfully dethrone any blockchain-based competitors in their industry?
• What are the possibilities past the first use case?
• Is there a core technical or product advantage that is likely to lead to competitive differentiation?
• Does the company have strategic partnerships with trustworthy sources within the industry?
• Is it impossible to substitute the use of the token for another?

3. Technology: what is the tech?

• What type of technology is it? (DApp? Infrastructure? Currency?)
• What blockchain is it running on?
• Are they developing their own infrastructure instead? If so, why?
• Is the token mineable?

4. Minimum Viable Product: how solid is the product?

• Is there a working prototype?
• Is there a working prototype code working on a testnet?
• Do they have prototype code at all (even if its not currently executed)?
• Is the code a copycat that implemented no new features?
• Does the code have commentary?
• Does the commentary explain clearly the purpose of the function?
• Are the functions a reasonable length? i.e. are they less than 50 lines?
• Does the code allow for rapid expansion of user base and network interactions?
• Are there any external audits of the code?
• Is the product's technical specification thorough and does it demonstrate mastery of the subject matter?
• Are there people out there who want and need this product right now?
• Does the product benefit from network effects?

5. Team: who's running the show?

• Who is the founder, what is his/her background? (Have they built and sold a company before, or a new entrepreneur?)
• Can the team be found on LinkedIn and Github?
• Is the team exceptional technically, inclusive, transparent, objective and capable of fostering a vibrant global community?
• Can this team attract partners and participants?
• Are there people on the team who understand marketing and evangelizing?
• Does the team have a history of success, demonstrated ability to overcome obstacles to success and strong desire beyond money?
• Has the founding team demonstrated the characteristics (inclusive, transparent, objective, etc.) necessary to build a healthy community?
• How will the team continue to communicate their progress?
• Does the company blog regularly about their work?
• Have any members of the founding team participated in blockchain and/or cryptocurrency industry events?
• What is the founding team's expertise with cryptocurrencies and blockchain? Are there any red flags concerning their credibility in these areas?
• Is the team able to explain, in relatively simple terms, the value derived from using the blockchain?
• How many developers are on the team?
• Do the team's developers have active GitHub profiles?

6. Advisors: who are the big guns? (mentors and advisors)

• Are there any industry experts backing the project financially or as advisors?
• What tangible benefit (i.e. advice or strategic connections) do advisors provide the company?
• Do advisors include the project on their own public profiles such as LinkedIn?
• Have advisors discussed the project publicly and recently?
• How involved are the advisors in the project's online community?

7. Roadmap: where do they plan to go?

• What is the team's timescale for implementing their proposals?
• How detailed is the plan?
• How realistic is the vision?
• Are the goals achievable based on what the team has accomplished to date?
• Is token distribution linked to the roadmap?

8. Token Offering Structure: how likely am I to get burned?

• What is the hard cap?
• What is the soft cap?
• How many tokens are being created?
• What is price per token?
• Is there a pre-sale?
• Who has written up the token issuance contracts and actual token issuance software?
• Which blockchain infrastructure is backing up their sale?
• Will the software platform generate new tokens?
• What is the planned use of funds? (e.g., marketing, legal, development, etc.)
• What share of the token distribution is allocated to bounty program?
• How are tokens put into the hands of investors and interested individuals?
• Are the founders holding onto most tokens?
• How long is the vesting period before investors can diversify?
• Are the funds in a multi-signature wallet?
• How do you buy tokens? Is there Escrow or direct to a company wallet?
• Is the team going to destroy or redistribute a significant part of unsold tokens?
• Is the token distribution coming directly from a smart contract?
• Is there a cap on funds raised per person?
• What rights does the token provide the investor?
• Are there any limitations on the ability to resell the coin or token?
• Is there a lock-out period? If so, for whom?

9. Hype: what are people saying about the ICO? (ratings + community + PR)

• Is there a well-developed whitepaper?
• Is there a professional website?
• Does the project have an announcement (ANN) thread on BitcoinTalk?
• Is there a Reddit community?
• Is there an official presence on Slack, Rocketchat, Gitter, Telegram?
• Does the company report progress on a regular basis?
• Are there a significant number of users on the main social media pages for the project? (Bitcointalk, Telegram, Twitter, Medium, and YouTube)
• Is the social community diverse?
• How is customer service and tech support on the project's social media accounts?
• Is there a bounty program?
• Is there an airdrop?
• How often has the project been mentioned in the press?
• Has the project been mentioned in mainstream technology media and in prominent finance publications? (Techcrunch, VentureBeat, Forbes, WSJ, Reuters, etc.)

10. Legal Considerations: is this on the up-and-up?

• Does the company have a physical address listed publicly?
• In what jurisdiction is the company incorporated?
• Do either national or international regulations apply to the project?
• Is the ICO compliant in your country?
• What legal structures are being disclosed?
• If a security token: federal and state securities laws require investment professionals and their firms who offer, transact in, or advise on investments to be licensed or registered. Is this the case?
• Is there a SAFT agreement?
• How is security handled?
• What are the apparent, perceived or real regulatory risks?
• Are there plans for external or internal audits?
• Have they published the terms and conditions of the sale in clear language?
• If there is a DAO (Decentralized Autonomous Organization) -like component, is its articulation realistic and well grounded?

Thanks in advance for your input!

Crypto-Kristen  

SOURCES:
1. "Our Process for Evaluating New Tokens" by Nick Tomaino https://thecontrol.co/our-process-for-evaluating-new-tokens-4627ed97f500
2.  "Scrap the White Paper: How to Evaluate Tokens and Blockchains" by Coindesk https://www.coindesk.com/scrap-white-paper-evaluate-tokens-blockchains/
3. "How to Evaluate an Initial Coin Offering" by Strategic Coin http://strategiccoin.com/evaluate-initial-coin-offering/
4. "Due Diligence: How to Evaluate an ICO" by Cryptos R Us https://cryptosrus.com/due-diligence-how-to-evaluate-an-ico-initial-coin-offering/
5. "Due Diligence: How to Evaluate an ICO Investment" by Bitcoin Market Journal https://www.bitcoinmarketjournal.com/ico-due-diligence/
6. "10 Steps for Evaluating Digital Asset Crowdsales" by  Token Market https://tokenmarket.net/blog/how-to-invest-to-ico-and-blockchain-tokens/
7. "10 keys for evaluating Initial Coin Offering (ICO) investments" by CryptoPotato https://cryptopotato.com/10-keys-evaluating-initial-coin-offering-ico-investments/
8. "Methodology" by ICORating https://icorating.com/methodology/
9. "ICO Analysis Framework" by Kasper Rasmussen https://blog.ethfinex.com/analysing-icos-4abe41930f04
10."Evaluating Tokens and ICO" by HackerNoon https://hackernoon.com/evaluating-tokens-and-icos-e6c22c1885bb
11. "ICO Analysis Framework" by MT Kander http://www.mtkander.com/cryptocurrencies/ico-analysis-framework/
12. "How to Value Cryptocurrency" by HackerNoon https://hackernoon.com/the-7-things-you-need-to-know-from-the-valuing-cryptocurrency-conference-call-c238095a03b9
13. "White Papers Versus Other ICO Evaluations" by Financial Advisor Magazine https://www.fa-mag.com/news/white-papers-versus-other-ico-evaluations-36272.html
14. "How to evaluate a Blockchain ICO" Nami Consulting http://consultnami.com/how-to-evaluate-a-blockchain-ico/
15. "How to Evaluate an ICO (a VC Perspective)" by Lauren Stephanian https://medium.com/the-mission/how-to-evaluate-an-ico-a-vc-perspective-65ac781971b6
16. "Investor Bulletin: Initial Coin Offerings" by United Securities & Exchange Commission https://www.investor.gov/additional-resources/news-alerts/alerts-bulletins/investor-bulletin-initial-coin-offerings
17. "How to Evaluate an ICO" by Shermin Voshmgir https://medium.com/blockchain-hub/how-to-evaluate-a-ico-part-1-c6829d4de766
18. "ICO Bounty Programs: Your community should be more than Bounty Hunters" by Brian D Colwell https://briandcolwell.com/2017/12/ico-bounty-programs-your-community-should-be-more-than-bounty-hunters/.html
19. "The ICO crapcoin checklist" by Matthew Roberts http://roberts.pm/ico_crapcoin_checklist
20. "4 Criteria For Evaluating Blockchain ICOs" by CoinDesk https://www.coindesk.com/evaluate-blockchain-initial-cryptocurrency-offering/

Holycrap,you just nailed it,you did a very good job in researching all of these i know it takes days before you got all of the information needed,im sure you will be a good investor as you are a newbie you really did what you must do to learn the basics.

[Sephire]

Thanks for the comprehensive list of TODO evaluation points for an ICO. Clearly, it is
plenty of hard work and not a trivial task for most common investors.

[Kristen_Colwell]

I think there are problems with this section... some questions shouldn't be here. What do you think?

9. Hype: what are people saying about the ICO? (ratings + community + PR)

• ====>Is there a well-developed whitepaper?
• ====>Is there a professional website?
• Does the project have an announcement (ANN) thread on BitcoinTalk?
• Is there a Reddit community?
• Is there an official presence on Slack, Rocketchat, Gitter, Telegram?
• Does the company report progress on a regular basis?
• Are there a significant number of users on the main social media pages for the project? (Bitcointalk, Telegram, Twitter, Medium, and YouTube)
• Is the social community diverse?
• How is customer service and tech support on the project's social media accounts?
• Is there a bounty program?
• Is there an airdrop?
• How often has the project been mentioned in the press?
• Has the project been mentioned in mainstream technology media and in prominent finance publications? (Techcrunch, VentureBeat, Forbes, WSJ, Reuters, etc.)

[Kristen_Colwell]

Thanks for the comprehensive list of TODO evaluation points for an ICO. Clearly, it is
plenty of hard work and not a trivial task for most common investors.

Thank you!! 

[Kristen_Colwell]

DANG @panghae. Thank you. :-)

I'm just stoked to be here.

Crypto-Kristen 

[Kristen_Colwell]

I think there are problems with this section... some questions shouldn't be here. What do you think?

9. Hype: what are people saying about the ICO? (ratings + community + PR)

• ====>Is there a well-developed whitepaper?
• ====>Is there a professional website?
• Does the project have an announcement (ANN) thread on BitcoinTalk?
• Is there a Reddit community?
• Is there an official presence on Slack, Rocketchat, Gitter, Telegram?
• Does the company report progress on a regular basis?
• Are there a significant number of users on the main social media pages for the project? (Bitcointalk, Telegram, Twitter, Medium, and YouTube)
• Is the social community diverse?
• How is customer service and tech support on the project's social media accounts?
• Is there a bounty program?
• Is there an airdrop?
• How often has the project been mentioned in the press?
• Has the project been mentioned in mainstream technology media and in prominent finance publications? (Techcrunch, VentureBeat, Forbes, WSJ, Reuters, etc.)

What about a section for Marketing in addition to a section for Hype. So Hype is how the crypto community and general public respond to marketing and PR initiatives (or lack thereof). Marketing is the go-to-market strategy and related tactics (e.g., website, advertising, bounty programs, etc.).

Make sense?? 

Crypto-K

[DioBrando]

I think there are problems with this section... some questions shouldn't be here. What do you think?

9. Hype: what are people saying about the ICO? (ratings + community + PR)

• ====>Is there a well-developed whitepaper?
• ====>Is there a professional website?
• Does the project have an announcement (ANN) thread on BitcoinTalk?
• Is there a Reddit community?
• Is there an official presence on Slack, Rocketchat, Gitter, Telegram?
• Does the company report progress on a regular basis?
• Are there a significant number of users on the main social media pages for the project? (Bitcointalk, Telegram, Twitter, Medium, and YouTube)
• Is the social community diverse?
• How is customer service and tech support on the project's social media accounts?
• Is there a bounty program?
• Is there an airdrop?
• How often has the project been mentioned in the press?
• Has the project been mentioned in mainstream technology media and in prominent finance publications? (Techcrunch, VentureBeat, Forbes, WSJ, Reuters, etc.)

To me one point should be clarified better: what do u mean when u say "well-developed white paper"?
What are the indicators that could lead to a good review?
It may sound obvious but it's not

Plus, but that's a personal view, to me, having a high reward program (+ 30/40/50% bonus for example in ICO) gives me the impression that team needs to push the product through marketing because otherwise that wouldn't be too appealing (IF there's a product yet).
Advertising is fundamental but to me, when you have a nice set up, a focused roadmap and most of all a clear vision of your business that is implemented through your product, you don't need to go that far with numbers pre-market.

Jm2c

[AIRDROPSQUAD]

Good topic, i agree about your point "Is there a working prototype?"
I think that poin is the most crucial. Many ICO, don't have any working product. They only focus on their crowdsales rather than the product.

[potraviny]

Really great list, I will share this with all my friends who want to get involved in ICOs but don't have a clue where to start.

[oiskipoiskicrypto]

I think there are problems with this section... some questions shouldn't be here. What do you think?

9. Hype: what are people saying about the ICO? (ratings + community + PR)

• ====>Is there a well-developed whitepaper?
• ====>Is there a professional website?
• Does the project have an announcement (ANN) thread on BitcoinTalk?
• Is there a Reddit community?
• Is there an official presence on Slack, Rocketchat, Gitter, Telegram?
• Does the company report progress on a regular basis?
• Are there a significant number of users on the main social media pages for the project? (Bitcointalk, Telegram, Twitter, Medium, and YouTube)
• Is the social community diverse?
• How is customer service and tech support on the project's social media accounts?
• Is there a bounty program?
• Is there an airdrop?
• How often has the project been mentioned in the press?
• Has the project been mentioned in mainstream technology media and in prominent finance publications? (Techcrunch, VentureBeat, Forbes, WSJ, Reuters, etc.)

I don't see much wrong here, you have covered the main marketing tools when it comes to ICOs, maybe you could look into the number of people who are involved in the bounty program? If it is popular. I think you could also look into their own content creation methods as well, I find that usually when an ICO has been mentioned in the press, it is because they have thrown money at it rather than it actually being a good project.

Maybe also include events? I know it's always refreshing when they are also great online as well as offline.

Other than that it is a great list, I am impressed! Keep up the good work.

[Kristen_Colwell]

Investing in coins is pretty slow in my experience. It can take weeks before they take off and you see a profit.
If you want to multiply your investment, these are the best Pump&Dump groups I've found in Discord:

Go away! This is not the place for your spam. 

BYE,

Crypto-Kristen

[Kristen_Colwell]

Hi all,

I am working on a video or a series of videos to go with THE LIST. First will be a primer on THE LIST and how it is intended to be built and used. Later, I can focus on specific sections and/or can apply THE LIST to specific ICOs.

Thanks everyone for the collaboration!

Crypto-Kristen 

[itsonlikedonkeykong]

Great list!

Under marketing, you should prioritize Telegram and add social media presence.

The Telegram should be very active and growing with admins and regular access to key team members for questions.

Social media should include Twitter and Facebook at a minimum, with a LinkedIn Company page as well. Each key team member should be easy to find on LinkedIn, listing the project as well.

[Kristen_Colwell]

Great list!

Under marketing, you should prioritize Telegram and add social media presence.

The Telegram should be very active and growing with admins and regular access to key team members for questions.

Social media should include Twitter and Facebook at a minimum, with a LinkedIn Company page as well. Each key team member should be easy to find on LinkedIn, listing the project as well.

Completely agree. Updating the list shortly.

Thanks for the input! 

Crypto-Kristen

[Kristen_Colwell]

Updated!

Thanks @itsonlikedonkeykong

Have you hugged an ICO today? 

Crypto-Kristen

[MichaelMeu]

Wow...great feedback from @MichaelMeu, thank you! THE LIST is looking sharp.

Also, re: the hype section. Note that the response to each question is not necessarily positive/negative, just facts... so a lack of hype despite positive factors in other areas would not strike an ICO from consideration. BUT if other factors are also problematic, then non-existant or negative hype can make an impact of the ultimate success of the ICO.

 
Crypto-Kristen

You're welcome  

I'll get replying to the rest of this in a mo!

[Kristen_Colwell]

THE LIST Fundamentals

• Strong sources lead to strong opinions
  
• Data is neither “good” nor “bad”
• Perfection is the enemy of done
• Come to terms with your personal bias

Anything you would add?

 
Crypto-Kristen

[Kristen_Colwell]

Defining THE LIST

A growing list of questions assembled by the crypto community, broken into segments, organized sequentially, and used as a framework for analyzing ICO opportunities.

Do you agree?

  Crypto-Kristen