An Initial Coin Offering (ICO) is a crowd funding campaign by the developers to raise funds for their blockchain technology. It’s analogous to the Initial Public Offering (IPO) of the Stock Market. Developers of a blockchain will use the raised funds for the development, marketing, and future milestones of their project.
This article answers the question “What to look for in an ICO?”. Before investing your hard-earned money to any available ICO you see, better check the items below if a blockchain project is feasible to have mass adoption in the future and its legitimacy. In this article, we will be reviewing Dragon, a blockchain technology for the casino gaming industry.
Note: This is not a rating guide where 0 is the lowest and 10 is the highest. This article just serves as a guide for the things you should be looking for an ICO and you should still DYOR (Do Your Own Research).
1. Whitepaper
The whitepaper explains everything in detail about the blockchain project. It may come in different forms and layouts. Some are very technical, some are explained in layman’s terms. Some are full of graphics, some are text-based. Some are very much explained in detail, some are direct to the point. The whitepaper can be summarized in a shorter to read version such as a one-pager or a lightpaper.
In Dragon: They have a detailed whitepaper and it can be viewed here:
https://s3.amazonaws.com/drg-token/Whitepaper-Dragon.pdf
2. Roadmap
The roadmap pertains to their long term goals in planning, development, and executions of their project. This includes the planning before the ICO. Some roadmaps even include their prior projects before migrating it to a blockchain technology. Some give up to 5 years in the future while some only give one or two years of development and execution mapping. This is one of the most crucial things to check for an ICO because you can see if the developers are within the time period of launching their promised milestones such as listing to external exchange, developing another application, and so on.
In Dragon: They don’t have a roadmap in their website or whitepaper.
3. Community and Social Media
An exquisite project has a very active community to support each other. The community is composed of the developers and of course the end-users of a particular project. They should have at least the three primary social media platforms such as Facebook, Twitter, and Telegram. Facebook and Twitter are needed mostly for the updates from the developers and Telegram is needed for the real-time interaction with the developers and the users.
In Dragon: They can be reached through the top social media platforms. Their admins are very active in Telegram.
4. News from Mainstream or Online Media
Cryptocurrencies are not anymore just for the technical ones because Bitcoin had mainstream attention last year. Since past technologies need to be further improved in the future, mainstream and online media tend to be updated with current technological trends. Whether a TV segment, online news, or a broadsheet article is either a marketing effort or the project really created a buzz, we can see that a project is in the right path. If an exposure is a marketing effort, then the team is active in marketing. If the project created a buzz, it’s because many people already believe and foresee the future of the project.
In Dragon: They are already featured by online media agencies.
5. Bitcointalk Announcement
The Bitcointalk website is regarded as the most cryptocurrency-oriented forum in the world for Bitcoin and alternative coins (altcoins). It is expected that the earliest adopters of cryptocurrencies are there. So it’s safe to say that if you want to launch a specific blockchain technology or application, it should be first announced to the Bitcointalk community. Since the forum is one of the pioneers about topics of crypto, it’s also safe to say that most of the people who’ve gone rich in Bitcoin, even as early as getting their hands-on Bitcoin when it was just around $0.10 in 2009, are in Bitcointalk and are planning to get richer by investing in newer blockchain projects.
In Dragon: They have an announcement in Bitcointalk website with this link:
6. Specific Use
Just like companies focusing on their specific industry in banking, healthcare, and electricity, crypto projects should have a definite use. The most common uses in general are currency, platforms, payments, and utilities. Bitcoin is the most famous cryptocurrency. Ethereum is the most widespread used platform because of its smart contracts. Ripple is the most common payment system. Monero and Verge are good examples of a privacy coin. Sia is the most famous cloud storage based solution in crypto. Without a definite use, a coin would just be a sh*t coin waiting for adoption from big companies, if ever they’ll even be adopted.
In Dragon: Dragon plans to create a platform where Dragon Coins (DRG) will be used. Dragon Coins can be used for the shopping and payment needs of the users because they’ll be having their own ATM Debit Cards. On the other hand, DRG can be used to purchase Dragon Gaming Chips (DGC) wherein DGCs can be used by high-profile casino gamers for their gaming sessions in Dragon Junkets. Dragon plans to create this platform to significantly reduce junket fees by the investors who manage to create these junkets to be played upon by VIP members.
7. Usable Application or Product
Most ICOs I’ve seen never had any working applications before their ICO. Whether it’s a working product, a website, or even just a prototype, an ICO should have at least a sample of their application or product, either it’s fully functional already or still in its early stages. Most ICOs were merely plans and papers where they would just start developing their application or product after raising funds. Legit ICOs should already have at least a sample of their project to be developed in full force once their crowd funding is finished.
In Dragon: They don’t have any working sample or prototype yet.
8. Token Distribution
In their whitepaper or their website, it should be clearly stipulated how they are going to distribute their tokens. Meaning, they should be very transparent to indicate how many tokens would be given to the development team. An ICO with a high percentage (70% and above) of distribution to the crowd sale may have a hard time increasing in price because there is little to no more room for growth and improvements. It can also be beneficial in the short term because there would be no more tokens to be distributed and the demand will be greater thus increasing its price in just a few months. On the other hand, an ICO with an average percentage (20 – 70%) of distribution to the crowd sale may take some time to increase its price due to the fact that there would still be many tokens to be distributed through mining or staking. It can also be beneficial in the long term as its application gets mass adoption in the future. Still, everything in cryptocurrencies is subject for speculations.
In Dragon: Their token distribution is detailed in their whitepaper.
9. Maximum Supply
The main reason Bitcoin had unbelievable price increase in 2017 because it only has a max supply and its current distribution of around 16.8 million is nearing its max supply. Just compare it to the analogies of cars. A Ferrari and a Lamborghini will always be more expensive than a Toyota and a Mazda. Why? Because only a few Ferrari and Lamborghini were created, maybe around thousands, compared to the millions of Toyota and Mazda. It’s a very big no-no for an ICO to have no max supply, unless you’re a platform, privacy, or storage coin that needs to issue further tokens to its new users. Up to tens of billions will be good for the max supply of an ICO but not above hundreds of billions or even trillions. You should also read about a coin burn for unsold tokens in their whitepaper. Since a crypto should have a max supply, they won’t be distributing new tokens after the ICO so there would surely be an increase in price in the future.
In Dragon: Dragon has a maximum supply of 500 million Dragon Coins.
10. Publicized Team
The team is behind it all. From the planning stage, to development, execution, and of course for future milestones, the team behind the blockchain project should always be checked. You should verify their names and affiliations especially in LinkedIn if their reputation has been kept in pristine condition or if they had been part of some malicious activities in the past. Although the founder of Bitcoin, Satoshi Nakamoto, is just a pseudonym, it can either be a single person or a group of people. No one knows who he is but newer ICOs should take into consideration of publicizing the team behind the project so they can be held accountable for problems that may arise in the future.
In Dragon: Their team is posted on their website and whitepaper.
Bonus: Partnerships
Since blockchain technology is just in its infancy, many businesses built on traditional platforms may be wary of adopting or partnering with companies built on top of blockchain. If prior the ICO they already have a working application or product, add that to the years of expertise and connections of the team behind the project, they should’ve at least some future partners with their blockchain technology.
In Dragon: They already have some partners listed on their website.
Summary:
Disclaimer: This is not an investment advice. Invest at your own risk. Invest only the amount you can afford to lose.
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Website: https://www.drgtoken.io/
Whitepaper: https://s3.amazonaws.com/drg-token/Whitepaper-Dragon.pdf
Facebook: https://www.facebook.com/dragoncoin.online Twitter: https://www.twitter.com/dragoncoin
Telegram: https://t.me/joinchat/FSgY4RI3tNfalmD2sbIZRg
Author: https://bitcointalk.org/index.php?action=profile;u=1767289
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