6 benefits of early investing

Crypto investing is one of the most controversial trading options, as it is considered a rabbit fall into which most people fall. Many users have invested most of their money and life savings into crypto, as they’ve heard from other investors that it yields high returns. But that was happening only after the first cryptocurrency was issued. The Bitcoin price was much more affordable a few years ago when the value of the coin was the result of high demand. Of course, bitcoin’s popularity made it stand still until now, 20 years after its reveal on the market, but things have drastically changed since.

One lesson that investors and regular people must know is that early investing will provide better returns and leverage fewer risks. However, if you’re interested in starting to invest, you need to be up to date with the latest news and developments so that you can participate in the early stage of the coin’s announcement. 

Let’s see what are the benefits of early investing, also known as Initial Coin Offerings (ICO), and how you can build a stable and long-term crypto portfolio with this strategy. 

What is an ICO?

Initial Coin Offerings require investors and regular users to have some previous knowledge of what the sector has to offer. That’s because the ICO helps raise funds for crypto products and services for the new coin issuance. This is also the time when the white paper is released, containing all the essential information about the project to make more people interested in it. 

The white paper explains relevant information related to the ICO, such as how much money the plan needs or what type of payment is accepted.

Given that anyone can launch an ICO, you need to be wary of the project’s legitimacy because many have lost their funds investing in fake ICO projects. However, if you do your homework and ensure the people behind the ICO have genuine objectives, and their blockchain is confirmed, you’ll be able to invest safely.

Initial Coin Offerings have the advantage of providing the potential for very high returns, which is why you need to be early on the move. However, fraud is one challenge that everyone needs to be careful with.

Are there any successful ICOs?

Initial Coin Offerings helped many cryptocurrencies boost their popularity and value. One of them is Ethereum, the second most known and demanded crypto on the market. It has also been one of the first ICOs that raised more money than Bitcoin due to its smart contracts and decentralized apps. Other outstanding projects include IOTA, Stratis, EOS and NXT.

Ethereum, for example, was sold during the ICO for $0.31, which has now brought considerable returns to early investors as its price has increased in the past years. Stratis also started with $0.01 per token initially, while NXT had only $0.0000168 worth during the ICO.

What are the benefits of early investing (ICO)?

1. ICO has many advantages for people who want to get into crypto investing, but prior knowledge is necessary to understand the pros and cons. However, ICOs are pretty convenient for start-ups and investors because they offer the opportunity for a range of people to access investment projects. Compared to traditional funding, crypto ICOs don’t have any time constraints, which gives investors more flexibility.
2. Another advantage of ICOs is linked with the online environment. As these offerings take place on the internet, it’s easy to gather information and get knowledgeable on the offer as an investor. Any serious ICO has a website providing all the necessary information and provides communication channels through which people can connect. This helps large audiences get insight into what they’re looking for in an investment. At the same time, companies don’t have to invest in expensive marketing and advertising, as blockchain-based features allow them to reduce the cost of raising capital.
3. Investors can also save time while investing in ICOs because they’re less time-consuming or energy-draining. ICOs are usually very efficient as the blockchain maintains a ledger of multiple transactions with updated data, so people won’t have to rely on regulatory filing.
4. The blockchain network made available is by far the biggest benefit. That’s because it boosts all activities and makes it easy for all parties to engage safely yet anonymously. Blockchains make ICOs easy to maintain as they only need to be monitored and updated regarding the distributed digital ledgers. The blockchain mitigates fraudulence issues since the decentralization concept allows all investors to learn about the ICO process continuously.
5. Initial Coin Offerings have high-profit potential as well as ROI. Although they’re considered to be risky investments, most users stated that usually, the profits outweigh the losses, as many cryptocurrencies have replaced Bitcoin in terms of utility and uniqueness.
6. Finally, the lack of intermediaries helps save time and also minimizes the costs of funding. Since there’s less government control compared to traditional offerings, investors can freely leverage their interest, and companies can be helped with a boost in their financials.

What are the drawbacks of ICOs you need to consider?

Despite being successful crypto projects, ICOs also have some disadvantages you need to be aware of. For example, many projects have a low success rate as only a few can actually write a proper white paper. Plus, if the ICO project fails, the tokens will immediately lose value, so they can’t be repurposed. Even if the project is successful, unfortunately, the regulatory mechanism is not fully available or properly managed, which can hinder the offering process.

Finally, let’s not forget that ICOs are prone to scams and used by malicious companies for illicit activities, which can make most investors avoid ICOs as it can be challenging to separate genuine ones from fake projects.

Bottom line

Early investing in an ICO project of a cryptocurrency is best because it offers you the opportunity to observe the evolution of a digital asset. At the same time, if the project is successful, you can yield high returns and build a stable and profitable portfolio.