ICO Is an Investment Risk, That’s Not True
Initial Coin Offerings (ICO) is the fastest growing form of investment whereas seeking funds from venture capitalists is a daunting task. Many label ICOs are risky for investments but they don’t know the capability and the true power the platform holds.
In IPOs, investors get their shares in return for their investment but that is not always the case for an ICO investment. Hire ICO expert and know in detail about the intricacies of the ICO development process. The experts will tell how ICOs are better than IPOs.
ICOs offer utility and security tokens in exchange for the crypto investment. Security tokens act more like a share but utility tokens are meant for offering services in particular. Anyways, ICOs if developed properly, chances of scams are low.
When we talk about investments, they are subject to risk in any form. If you are thinking of serious crypto investment, we will advise for thorough research on ICO official website, whitepaper, smart contracts, team, and social media presence.
Smart contracts and ERC20 token standards are discussed here for an understanding.
Smart ContractsSelf-executing contracts written on blockchain are super easy because they save time. Transparency of these contracts minimizes the risk in ICO investments. Terms and conditions of the contract are visible and there is no way of corrupting them.
Highest level of data encryption for these automated contracts is another plus. There is no central authority so there is no way of upsetting the balance of a smart contract.
Accuracy in detailing the contract is immaculate and there is less to no communication gaps. Hence, transparency and accuracy factors reduce investment risk.
ERC20 Token StandardERC20 standard is in place for all to follow the set rules. Although, this isn’t the imposed rule as DAPP developers can adopt other ways. Point is, this standard ensures compatibility of the code with various wallets, exchanges, and smart contracts without any complications.
Also, this standard shows how the tokens will work in future. And the ERC20 token standard is widespread and accepted in DAPP developers.
The standard performs 4 basic functions:
- Total token supply details
- Account balance
- Token transfer from one account to another
- Tokens approval as a monetary asset
ERC20 is industry known practice for tokens which is the reason why, it can be trusted.