ICOs: Their Preparation and Launch

ICOs: Their Preparation and Launch

Conducting an ICO (Initial Coin Offering) is analogous to conducting an IPO (Initial Public Offering). It is a means to raise funds for a new venture, utilizing an existing cryptocurrency market. But instead of shares in this case, an enterprise issues tokens that the investors wil purchase with the already established cryptocurrencies like BTC, ETH or other forms of crypto money. And like with shares, an investor expects that the value of the token he purchased will grow with time, bringing him substantial dividends. There are also cases where an ICO can be conducted with a sole purpose of raising funds for a charity project, which is probably the only time when return on investment is not expected by the token's owner, at least, not in the sense of a traditional reward. 

Any project can launch an ICO based on an idea or a product or a service that they would like to offer. Some of the startups fail to reach their goals and many lose money for their investors. Some of the ICOs can even be fraudulent. But there are also many successful projects where the original value of a token has increased hundredfold since their ICO launch. The investment results for the newly-established industry, although on the average quite moderate, still make cryptocurrency projects, nevertheless, very attractive to the investors. 

The experience shows that a well thought-out idea, backed by a solid marketing and development plan, has a very good chance of succeeding as an ICO project. So far, the current statistics demonstrates that the three most successful ICO project categories are, first of all, the infrastructure projects of the cryptocurrency markets, then the projects that are solidly aligned with the existing legal framework of their country of residence and then come the innovative projects that present novel ideas (sometimes even regardless of the ideas' practical value). 

An ICO launch requires, as a minimum, preparing a smart contract, a white paper and a road map. While road maps and white papers are, in fact, marketing and legal documents for the ICO's smart contracts, the smart contract itself is a technical foundation for the project. Its' level of competence will directly determine the attitude towards the ICO assumed by the experts who will have studed and analyzed it and, as a consequence, the amount of funds that the project will be able to raise among the investors.

Numerous comical situation can arise during an ICO campaign, stemming from the inattentiveness of a blockchain specialist at the moment of completing his design. One ICO, for example, couldn't use the funds available in the wallet, which they had successfully raised, because their developer failed to set a fundraising termination date in their smart contract, dooming, thus, the whole enterprise to forever carrying out a never-ending fundraiser and, therefore, to a permanently closed wallet for the needs of the project. 

It is of paramount importance that the following steps are implemented when developing an ICO:

designing a smart contract;
auditing a smart contract;
connecting a project's web site with the ICO's blockchain;
monitoring the incoming funds before their release from the ICO's wallet for the project's expenditures. 

Special complicated cases may require developing specialized decentralized applications for managing the tokens in the project or even launching its own blockchain for this purpose. 

The mistakes in the preparations for an ICO launch can be very costly. We at Bit-Labs find it very useful to utilize, in addition to our blockchain developers, our network of independent consultants, specializing in the issues of the cryptocurrency market, both on the conceptual and the technical levels. Our experts will be happy to work with you in one of these capacities. It goes without saying, that, out of ethical concerns, we cannot serve both as your developers and also as your auditors. 

To facilitate your ICO launch, we will provide you with a team of ICO experts. Our team will include:

Team Leader who is also an experienced and qualified business analyst; 
Leading Blockchain Developer, highly experienced in decentralized apps and ICOs;
Smart Contract Developer, an experienced specialist in ICOs. 

If your project requires a launch of its own blockchain, we will also include in the team a system administrator and a blockchain developer. In addition, we can provide you with the necessary technical support for your blockchain after the launch of your ICO, should you need it. Developing a project with its own blockchain is a much more complex and time-consuming process that requires a great deal of collaboration and interaction between the team's developers, its' business analysts and its' blockchain specialists. Our participation in this type of a project necessities additional discussions and deliberations to order to provide you with a highly specialized and effective team structure that can serve you well.

Whether you are preparing for an ICO, or you require an audit of your smart contracts, or you are in need of general consulting services or blockchain support, please contact us here

To acquaint yourself with one of the solutions that we developed for an ICO project, please see "System of accounts module for ICO websites (all hyperlink)".