The Misplaced Emphasis And ICO (88 Perfect for you)
The Misplaced Emphasis and ICO Token Valuation on ICO Advisors And Blockchain Technical Experts
The statistics could not be ignored. Most ICOs tank, and stay tanked, once the tokens get to the crypto exchanges, after the frenzy and ‘FOMO‘ attending the crowd sale is over.
Most observers who follow the ICO phenomenon universally agree that the trend of the past two months is that ICOs lose value after mass selling.,
What is however not being discussed is that the principal reason why we are witnessing this phenomenon, and what participants during a crowd sale, including the rating companies most folks believe to form a choice, must be doing wrong in picking which ICO have the most value, or has the simplest probability of rising in value once the crowd sale is over.
While there are tons of reasons one could legitimately proffer for the phenomenon, there’s one incontrovertible fact that I feel is perhaps skilled for this than most other contending reasons: ICO token valuation and therefore the misplaced emphasis on ‘blockchain experts‘, ‘ICO advisors‘ or ‘technical whizkids‘ for erc20 tokens.
I have always thought the necessity for blockchain technical experts or ICO technical advisors is exaggerated or maybe outrightly misplaced when a project is judged by that criteria unless the project is really trying to make a fresh coin concept. for many ERC20 Tokens and copycat coins, the important consideration should be the Business Plan behind the token and therefore the managerial antecedents and executive profiles of the Team leaders.
As anyone involved within the industry should know, creating an ERC20 token from Ethereum, or similar tokens from other cryptocurrencies, doesn’t take any great technical skill or require any overrated blockchain advisor (as a matter of fact, with new software out there, an ERC20 Token are often wiped out but 10minutes by an entire technical newbie.
So technical should not even be an enormous deal for tokens anymore). The key should be the business plan; the level of business experience; competence of the project leaders and therefore the business marketing strategy of most companies raising the funds.
Frankly, as an Attorney and Business Consultant of over 30 years myself to many companies globally, I cannot understand why people keeping trying to find some Russian or Korean or Chinese ‘Crypto Whiz‘ or ‘Crypto Advisor‘ to work out the strength of an ICO for what’s basically a crowdfunding campaign for a BUSINESS CONCEPT…
I am of the strong opinion that’s one of the main reasons why most ICOs never live up to their prelaunch hype. In an era where there’s an abundance of token creation software, platforms, and freelancer, the disproportionate specializes in the blockchain experience or technical ability of the promoters is usually misplaced. It’s like trying to value the probable success of a corporation that supported the power of its staff to make an honest website or app. That train left the station way back with the proliferation of technical hands-on freelancing sites like Guru; Upwork, freelancer, and even Fiverr.
People seemed too trapped within the hype and therefore the technical qualifications of individuals promoting an ICO, particularly ERC20 Ethereum based tokens then wonder why a technically superior Russian, Chinese, or Korean guy cannot deliver the business end of the corporate after the fundraising campaign.
Even tons of our ICO Rating companies appeared to allocate a disproportionate number of points to the crypto experience of a team member, what percentage crypto advisors they need, and therefore the ICO success experience they need on their team, instead of that specialize in the underlying business model to be created with the funds raised.
Once one understands that over 90% of the cryptos and ICOs out there are simply tokens created to boost crowdfunds for thought, and just not a token for token’s sake, then peoples emphasis will shift from technical angles to the more relevant work of evaluating the business idea itself, and company business plan.
Once we enter this era of evaluation before deciding whether to shop for or invest during a cryptocurrency, then we’ll start valuing future prospects or value of our tokens supported sound business considerations such as:
- Swot Analysis of the corporate and its promoters
- Managerial competence and knowledge of the team leaders
- The soundness of business idea beyond the creation of a token
- The marketing plan and strategy of the corporate to sell those ideas
- the power to deliver the underlying products to the marketplace
- The customer base for the products and services to be created by the corporate
- and basis for projecting adoption within the market place
What most of the people did not realize is that the potential for his or her tokens to rise in value post-ICO isn’t such a lot hooked into anything technical but on the great things happening within the company raising the funds and therefore the perceived increase within the valuation of the corporate because it rolls out its business plan and delivers on its business products.
Of course, buying cryptocurrency isn’t buying stock, and it isn’t buying the safety in any company. We get that, but tokens react much an equivalent way as stocks react to excellent news or bad news a few companies. the sole difference is that within the case of cryptos, the effect is magnified a 100 fold.
So, when a corporation meets some financial or business milestone, the worth of its token on the exchange will go up… and it goes down fast when nothing good is occurring. So, what the corporate will do and the way it’ll roll in the hay after the ICO should of the utmost importance to anyone who doesn’t want to ascertain the worth of his Tokens plummet and stay down forever.
Sure, tokens most tokens would plummet once the tokens hit a crypto exchange after the ICO, due to those that want to require immediate profits, but whether it might ever come up to offer you the expected multiple digit profits will always depend upon the standards I already outlined above. After you’ve got purchased a token, the worth of the ‘crypto advisor’s and ‘technical whizkids‘ attend zero in reference to the potential of your tokens to moon.
Following this reality, I feel a sensible crypto buyer or investor should focus less on what percentage crypto advisors a project has or how technically sound the team is (unless the underlining business of the corporate is technical in nature) and focus more on the managerial, marketing and potential customer base of the corporate raising funds through an ICO.
In other words, allocate more points on the business and management side of the ICO instead of the technical jargon which won’t help your token within the marketplace when the cash has been raised!