Over time Initial Coin Offerings (ICOs) have become a well-known method of fundraising for the blockchain projects that allow capital raising by providing tokens to the investors who are interested. For a successful ICO, it is important to adhere strictly to the ICO development checklist, which covers planning, execution, and other steps. Launching an ICO is integral for both start-up and experienced entrepreneurs. The increased demand for token sale has made ICO launch to be a good option for the owners. The developers can also start new processes in the crypto ecosystem and scale their businesses. Mostly you will find ICOs on Ethereum, as the first token sale, Mastercoin, was held on the Bitcoin network.
It is true that ICO development has several advantages as compared to the old fundraising methods but if launching an ICO is not done with complete planning then it can set challenges.
Earlier for fundraising the use of a crowdfunding platform was done but ICO development has been helpful to the businesses, as it allows them to sell assets while raising funds for blockchain projects. ICO allows you to sell specific digital assets and as the demand for your venture grows the token value raises which is a reward for investors. Crowdfunding can be done on your own or with the help of a company that provides ICO services.
Coin offerings are either private or public- Private ICOs cover a few investors who can attend the fundraising. Participation is open to approved personalities/financial institutions. Public ICOs are open to the general public, and everyone can be an investor. Usually, public ICOs are less well-known than private ICOs.
Working of ICO fundraising
Tokens do not provide equity in a company. The development of an ICO covers development of tokens via Ethereum (blockchain platform) with least code changes. Once an ICO is developed, it is time to trade tokens for cryptocurrencies, or else you can simply exchange them for money. A good strategy needs to be followed if you want to manage a coin offering initially.
The role of Whitepaper
There are several factors that decide the success of ICO development and whitepaper is one of them. Whitepaper is an official document that covers all the information for the stakeholders about the process. Details such as mission, vision, objectives, target audience, and other minute details are clearly mentioned in the whitepaper, as it is an official business document. Coin offerings start right away when the firm publishes the whitepaper, as this document promotes their token. An experienced ICO development company can provide the best document, covering every bit of information.
Steps for ICO development
Raising of capital can take place in a few months. The focus should be on solving the customer points that no one else can do and for this merging of your token with the product should happen, as this will contribute to the blockchain community. To get the best from the ICO development process you must focus on each and every step. The different steps that you must follow for a successful ICO development includes-
Good ICO team with ICO developers and advisors- There is a requirement for a professional team with experienced members to start with the coin offering projects. The team must have ICO developers and advisors. ICO developers must have good experience in smart contracts and blockchain to build a relevant product, and advisors should be digital currency experts.
Good product map- You need to create a map that is self-explanatory for the investors to know about your product. Having a good product map is a basic requirement for a token sale. Investors can quickly get to know about your team's work through the map. A map should be capable of converting your idea into reality while generating profit.
Good market research and planning- Knowing about the market demand is very important, as it helps you to design an ideal business model. The experts must do good research to know about the technicalities that can help the investors. After good research and planning, you can put your project on the market via different platforms to get feedback.
Informative whitepaper- Whitepaper is an official document of 30-35 pages that shares every bit of information about the ICO development services like-
- Identifying the target audience
- Problems faced by the users
- Your product and the solutions it offers
- Complete token details
- Token commercial applications
- Technicalities of your project
- Detailed map of your product
- Timeline of project
- Communication channels
- Team and company information
- Future of your token
- Stating use of funds
- Price of token at different stages
- Current users
Create a website for ICO launch- A professional yet user friendly website must be created for launching an ICO. Your website is an ideal platform that shares complete and authentic information about your project, token sale and other details. The website itself should attract the investors. To have an attractive and clear website you must go for UI/UX design options.
Promotion of ICO- Promoting your ICO is an important step to gain the best community support. There are different ways that can be chosen for promotion of ICO such as social media platforms (Facebook, LinkedIn, Twitter, and others). You must focus on content marketing, as good content about your project can be really engaging. You can go for ICO development company tools for initial coin listing. You must choose a website that shows the past, present and future of ICOs. For good communication you can make use of channels on Slack and Discord. Your presence on forums like DeFi (BitcoinTalk), Reddit, Blockchain will be a good option to attract techie investors. You can also be a part of events, meetups, exhibitions, shows and conferences that can spread your project among investors.
Deciding for token sales model- It is time to create ICO token and decide for the sales model. You have options for-
- Hidden caps- Caps can be either hard or soft, and once allotment ends, investors will only then know about the capitalization.
- Soft-Hard caps- They represent the minimum and maximum amounts that must be raised by your ICO before it ends. Representation can be done through the sale of tokens, and caps can be set before starting an offer.
- Capped model- You can cover the offering time for several months and keep it limited. The tokens are offered on a first come first basis, also the token is fixed for cryptocurrency exchange ratio. There is a limitation to the sale of tokens.
- Uncapped model- There are no restrictions or limitations for participants or the amount raised. There is no time limit for an initial coin offering, and the token-to-cryptocurrency exchange rate is fixed.
- Hybrid method- As the name suggests, you can go for a mixed sales model. New and latest token sale models can be used to create ICO tokens, as the concept of ICO is new and everyone wants the best.
- Dutch auction and reverse- Dutch auctions make use of smart contracts for counting the token price once all the bids have been received. The highest bid is given priority, and in the case of reverse auctioning, the sale begins with a high token price that decreases on a daily basis. The sale ends when the cap is reached.
Smart contract- Development of smart contract is a good option to create ICO token for distribution. Smart contract will allow asset holders to quickly transfer, sell and handle the tokens, as it is also connected to your token wallet. Smart contracts must ensure security, safety and proper functionality.
Digital wallet- Developing a digital wallet is a basic need for your ICO. It allows you to manage, store, and transact your tokens. You can easily and safely get, send, and store coin offerings.
ICO post sale- ICO token development is complete from your end and now the asset is available for sale/exchange. Fiat currencies can be exchanged for ICO tokens/coins. Success of your ICO development will give a real picture to your idea. Post sale looks forward to delivering the best to the contributors/community.
Listing on exchange platforms- To allow the exchange of one asset with another on the basis of market value, it is important to put your tokens/coins on cryptocurrency exchange platforms. This is an integral part of ICO development as well as marketing.
Closer look of ICO development
You must be aware of the pros and cons of ICO development before making a choice for ICO development services. Some of the advantages of ICO development include the ability to sell tokens across the globe. You will face less obstacles without any requirement of the third party. You get an option to save your digital currency and the liquidity premium gives a value to your token during ICO sale.
You cannot overlook the drawbacks, as there are scam ICOs, and you need to be aware of them. Regulator's intervention creates several obstacles that can be a serious nuisance, and ICOs usually have a low profit rate; however, only if the ICO development is perfect can you expect good returns.
You are aware of the steps that need to be followed for running a successful campaign by launching an ICO. Launching an ICO is a time-consuming process that requires a lot of planning, dedication, and timely execution. Following the steps meticulously will help you in a successful fundraising campaign that will certainly assure long term growth. A professional ICO development company can help you with your ICO process while assuring you your fundraising goals.