Buy initial coin offering (1)

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• INITIAL COIN OFFERING

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• An unregulated means by which funds are raised
  for a new cryptocurrency venture. An Initial Coin
  Offering (ICO) is used by startups to bypass the
  rigorous and regulated capital-raising process
  required by venture capitalists or banks.

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• In an ICO campaign, a percentage of the
  cryptocurrency is sold to early backers of the
  project in exchange for legal tender or other
  cryptocurrencies, but usually for Bitcoin.

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• When a cryptocurrency startup firm wants to raise
  money through an Initial Coin Offering (ICO), it
  usually creates a plan on a whitepaper which
  states what the project is about, what need(s)
  the project will fulfill upon completion, how
  much money is needed to undertake the venture,
  how much of the virtual tokens the pioneers of
  the project will keep for themselves, what type
  of money is accepted, and how long the ICO
  campaign will run for.

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• During the ICO campaign, enthusiasts and
  supporters of the firms initiative buy some of
  the distributed crypto coins with fiat or virtual
  currency. These coins are referred to as tokens
  and are similar to shares of a company sold to
  investors in an Initial Public Offering (IPO)
  transaction.

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• If the money raised does not meet the minimum
  funds required by the firm, the money is returned
  to the backers and the ICO is deemed to be
  unsuccessful. If the funds requirements are met
  within the specified timeframe, the money raised
  is used to either initiate the new scheme or to
  complete it.

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• Early investors in the operation are usually
  motivated to buy the crypto coins in the hope
  that the plan becomes successful after it
  launches which could translate to a higher crypto
  coin value than what they purchased it for before
  the project was initiated.

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• An example of a successful ICO project that was
  profitable to early investors is the smart
  contracts platform called Ethereum which has
  Ethers as its coin tokens.

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• In 2014, the Ethereum project was announced and
  its ICO raised 18 million in Bitcoins or 0.40
  per Ether. The project went live in 2015 and in
  2016 had an ether value that went up as high as
  14 with a market capitalization of over 1
  billion.

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• ICOs are similar to IPOs and crowdfunding. Like
  IPOs, a stake of the startup or company is sold
  to raise money for the entitys operations during
  an ICO operation. However, while IPOs deal with
  investors, ICOs deal with supporters that are
  keen to invest in a new project much like a
  crowdfunding event.

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• But ICOs differ from crowdfunding in that the
  backers of the former are motivated by a
  prospective return in their investments, while
  the funds raised in the latter campaign are
  basically donations. For these reasons, ICOs are
  referred to as crowd sales.