The Truth About Initial Coin Offerings - Risks, Rewards, and Real Stories

Welcome back,

When it comes to earning in the blockchain space, there are many options like staking, investing in cryptocurrencies, writing blogs, or offering services for blockchain projects. But apart from these, there is one area where not many people get to participate in and that is known as Initial Coin Offerings. Initial Coin Offering stands for Initial Coin Offering.

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If you are reading this blog and you are already part of the Hive blockchain, you might have participated in a few Initial Coin Offerings, as many projects often launch there. From my personal experience, I invested in Bad Idea AI, a token on the Shibarium blockchain, the same chain famous for Shiba Inu. In our case, where my team and I bought Bad Idea AI, we were able to make 5 times from our investment. It was an Initial Coin Offering event, and we participated during the pre sale phase. Thankfully, it worked well for us.

But not every Initial Coin Offering turns out to be profitable. There are a few things you should always check before investing in any Initial Coin Offering. First of all, make sure to go and check the team members of that Initial Coin Offering project. There you can learn about the team and whether they are well known and reputed or not. If you cannot find a proper team for a project, it is a bad idea to invest in the Initial Coin Offering of that project.

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Second, you must not invest more than 5% of your portfolio money in an Initial Coin Offering because Initial Coin Offerings are risky. And while investing in them, it is important not to put all of your money in one project. At maximum, you should invest 10 to 15% , but to stay on the safer side, I think 5% is enough.

Do you know one of the recent Initial Coin Offerings that was trending all around the world? It was the native token of Pump.fun, the platform famous for launching meme tokens. People have made millions by investing in meme coins that were launched here long ago. But what happened to the native token of that platform? The token named Pump, which is the native token of Pump fun, has come down drastically over time.

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There are a few reasons why this happened. One of the main reasons was that Initial Coin Offering holders were promised an airdrop, which has not yet taken place. Because of this, many started selling their holdings, which impacted the price a lot. From its launch price, the token has crashed by almost 60%, and that is not good at all. It is one of the worst performing tokens right now in the top 100. Sadly, I am also one of the investors, and I am sitting at almost 40-50% loss, so I know how it feels.

But I go by my rules, and that is why I only invested 5-10% of my portfolio value in this token recently, and I am still holding it. I think it should pump back up a little, and I will try to sell once it comes to my break even price.

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So one more thing I would like to point out here is a misconception which is among the newcomers. They often think that Initial Coin Offerings are equal to, is something similar to airdrops, but they both are different. Airdrops are where you get free tokens for completing tasks which are completely free. Yes, in present there are projects that give airdrops based on your investment result, but the initial idea of airdrops was always to earn free tokens without any investment.

In Initial Coin Offerings you have to put your money and participate in pre sale event and buy the tokens before they are on the market, that is on the exchange, and eventually you get to the tokens before they start trading. So yes, that is how Initial Coin Offerings work and so that is what I wanted to share. Second, there is something that hits you really hard when you see an Initial Coin Offering, especially an Initial Coin Offering which is trending all over the internet, and the thing that triggers is fear of missing out, which is fear of missing out.

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But you have to stay logical and make sure that you do not take any decision which will harm you. When everyone is talking about a project, it is easy to feel pressured to jump in, but obviously investing should always take time and research and that is what you have to do in order to protect your money.

And one more thing, you have to be prepared with a clear mindset before entering any Initial Coin Offering. Decide whether you are aiming for short term profits or long term holding, and stick to that plan. If you are going with a short term strategy, make sure to exit once you make a 2 times or 3 times return on your investment. On the other hand, if your plan is long term, you can continue to hold, especially if the project is from a well known platform or backed by a reputed team. But if the project is from a new or lesser known platform, it is often wiser to take short term profits and exit, rather than risking a long hold.

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So with that, I would like to conclude this blog by saying that you must be very careful when investing in Initial Coin Offerings. Do proper research about the team, the project, and what they are trying to build in this world. Check their Twitter handles and social media accounts, you will understand whether they are actually planning to build something or not.

If their social media accounts are simply not active, then do not invest in that Initial Coin Offering. And even after doing your own research, make sure not to invest more than 5-15% of your portfolio value because Initial Coin Offerings are risky, and there are chances that you might lose your money. So be careful when participating. And as I always say before ending a blog, take care of your investment, because only you can do it.

Thank you and happy trading everyone

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