From the cryptocurrency universe, there has arisen a new and popular way for businesses to access funding for their ventures. Traditionally, these businesses would have to seek investment from banks or other corporate financial institutions, and would often have to sacrifice large percentages of their company in exchange for this initial investment.
The ICO (Initial Coin Offering) model has dramatically changed this system. An ICO allows anyone with the required coin to invest in a company, and in return receive a coin (or token) which is proposed to have some future use or value. A good example of an early ICO is Ethereum (ETH), which raised over $18 million dollars. The ICO not only helped fund the project, but also distributed the ETH token allowing and instant userbase to be formed. Ethereum was distributed initially at a rate of 2000 ETH per 1 BTC. 2000 ETH today is worth around $920,000, so it’s very apparent that a good project offers a lot of financial potential for the savvy investor.
Ethereum growth against Bitcoin since 2016
Throughout 2017 there has been a large amount of “ICO hype” – businesses looking to fund their projects and lots of people looking to invest, often to “flip” the token for a quick profit. Some of these businesses have raised millions of dollars worth of major coins (usually Ethereum, hence the continued flat price in the middle of the year) and often with no actual working product. This has made it increasingly difficult for investors to find quality companies and has even lead to people funding scams, ponzi schemes, and general garbage projects *cough* Electroneum!! *cough*
I myself have invested in a few ICOs over the past year and, aside from one, all fill me with a decent amount of confidence about their growth over the coming years. I’ve had a few people ask me to share my ‘altcoin’ portfolio, so I’ve drawn up a chart with everything as a percentage of what I hold. I’ll give a more detailed look at some of my favourites, too.
Crypto portfolio held outside eToro. Correct as of December 2017
Bitcoin is quite a small percentage of my portfolio right now. This is mainly due to my exposure to Bitcoin already being quite high on eToro, but also because, at the time of writing, the price is quite high. I will be looking to add more should the price enter a correctional period, as described in my recent post here http://liamdavi.es/next-bitcoin-moving-december-2017/
Status is a mobile Ethereum browser enabling interaction with DAPPS on the Ethereum network, and transactions across the network directly from your mobile device. It’s currently in the alpha production stage, soon to be moving into beta testing. It’s open source and just an overall nice project. I got in at ICO and have held all my initial tokens. This should be a good long-term project. https://status.im/
Sand Coin (SND)
This is an interesting one. A Russian sand mining company based near Moscow funding their mine project with an Ethereum ICO. Unheard of, right? It might sound a little wild, but I see this kind of operation becoming very popular in the future. Offering the general public the opportunity to invest in tangible commodities projects is something we’ve not really seen before and could change the way people invest their money. I joined at pre-ICO and during the ICO and I’ve held since. https://en.sandcoin.io/
Disclaimer: All of the above is my own personal investment. None of the information provided should be taken as investment advice. You are responsible for your own actions and should understand the risks involved when participating in ICO events. I hold no responsibility for any loss (or gain) of earnings from any investments undertaken by individuals.