We continue our cryptocurrency ICO series of articles with the part most people are interested in. The concept of a cryptocurrency is quite alluring, as there are a lot of gains to be made. However, people can also lose money by investing in projects which will ultimately fail. One should never be blinded by greed when investing in an ICO, even though there is a good chance to make a nice profit.
Profits and Losses With Cryptocurrency ICOs
One of the primary reasons why people invest in cryptocurrency ICO is to make a healthy profit. That is only understandable, as the whole concept of investing is all about turning an existing amount of money into a bigger pile of money over time. If this can be done in the shortest amount of time possible, all the better. As we have seen in the past, a lot of cryptocurrency ICO tokens appreciate in value after the sale is over, which makes them quite attractive to investors all over the world.
Quite a few of these recent cryptocurrency ICOs have been overly successful. Most projects raise the amount of money needed in a few hours or days. As we discussed in the previous article, it is of the utmost importance to prepare properly before making an ICO investment. Missing out of these opportunities would result in missing out on massive profits – or losses – in most cases. Missing out on losses is not a bad thing, but the potential for profits is certainly there where cryptocurrency ICOs are concerned.
Perhaps one of the best examples of a cryptocurrency ICO is the Ethereum crowdsale. When the project was first announced, people could purchase ETH at the price of between 1,337 ETH and 2,000 ETH per BTC. This was back in 2014, when the value of Bitcoin was much lower than it is today, mind you. For the people who pledged one Bitcoin obtained 2,000 ETH in return, they have turned one Bitcoin into nearly 200 Bitcoin over the course of under three years. That fiat currency-based profits of this investment are even larger, due to both Ether and Bitcoin appreciating in value.
People may think such value increases are more of an exception than the rule these days. They would be sorely mistaken in thinking along those lines. It is important to keep in mind not every cryptocurrency ICO will see its tokens appreciate in value, though. Some projects will take much longer to complete, which means the token value can remain at the ICO price for quite some time. However, most of them will, in general, go up in value rather quickly.
Another recent example is the Gnosis ICO, which saw the value of its tokens increase in value pretty quickly. During the ICO itself, the price per token was around $30. Fast forward to today, and GNO tokens are worth $264.88. Not much has changed for the project ever since its ICO a few months ago, yet the token value is soaring to new heights. All of this goes to show a strategic cryptocurrency ICO investment can yield some spectacular gains given some time.
While the success stories are always great to hear, people have to keep in mind most ICO tokens would have no value were they not listed on cryptocurrency exchanges. Increasing values are all subject to speculation, rather than actual developments. From a trader’s perspective, buying into a cryptocurrency ICO is almost a guarantee for profits. However, if your token isn’t listed on a big exchange, its value will not go up all that much. Always conduct proper research before getting fooled by dollar signs in your eyes because a new project will hold an ICO.
If you liked this article, follow us on Twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin, cryptocurrency, and technology news.