ICO is an acronym for Initial Coin Offering. It is an unregulated way by which funds are raised for a new cryptocurrency venture. It is usually used by businesses that are still in infancy stage to bypass the regulated and challenging process which are mandated by banks or venture capitalists.
Investors are pre-allocated some quantity of cryptocurrency in the form of tokens in exchange for other cryptocurrencies like Ethereum and Bitcoin. If the ICO’s funding goal is met and the project becomes launched successfully, the tokens then become the functional units of cryptocurrency.
This means that a function of ICO is to enable a cryptocurrency launch through procuring funds for the costs of development and in order to attract the attention of developers to the project. The adoption and consequently, the usage of the coin, is increased by the number of people who hold the coin.
For the development process to be successful, it is absolutely important to have the assistance and the support of a large community.
LIFECYCLE OF AN ICO
At first, a white paper is released, which shows the details of the plans for any cryptocurrency. The details include what it will do, why it is useful and the plans for building the project and consequently how the funding which is raised will be used.
Secondly, a webpage that characterizes the raising of an ICO will be created and in addition, a group platform where people who are interested can be updated concerning the developments. The best platform to do so is the Telegram app, which is very secure.
Thirdly, people are allowed to register for the whitelist and this is in order to gain access to the pre-sale round. Then, when the pre-sale round has passed, funds can now be contributed by people through the sending of Ethereum or Bitcoin to a wallet address which has been made for the very purpose.
Once the goals of the project are attained, the tokens of the new crytocurrency will then be returned when the coin is launched. However, if reverse is the case and the project did not attain its goals, all the funds that had been contributed will be returned.
The ICO can be launched anywhere in the world. We will be focusing on Japan. To launch a successful ICO in Japan, there are five steps that need to be followed.
STEP 1 : Understand Cryptocurrency.
To understand something, you have to look into it and check out the problems that are unique to it. The same is applicable to Cryptocurrency. There is a saying that a solution is possible as long as the problems are known. Once you understand the space of cryptocurrency and the problems, you are good to go.
STEP 2 : Make Your ICO Legitimate
Many ICOs are scams. To make yours look legit, you need to make sure it is legitimate. To that, you need to do a lot of marketing and publicity and at the same time be unshakable in your confidence.
STEP 3: Be Vibrant In The Cryptocurrency Community
What keeps cryptocurrency alive is the continued participation of people in the issues that are related to cryptocurrency. When you participate, be in within Japan or outside Japan, you can easily understand new things concerning it.
STEP 4: Plan For The Future
Everyone knows the past and the present is what we are involved in but no one knows the future. As a result of this, one needs to make serious plans for that very future. Plan for both positivity and negativity.
STEP 5: Understand The Regulations of Cryptocurrency
There are many regulations in the Cryptocurrency industry and it is wise to understand all of them since the lack of understanding could determine the failure or success of an ICO.