How to evaluate ICO

Main article: ICO (Initial Coin Offering)

2017

10 rules of Bruce Fenton

In 2017, Bruce Fenton, a financial analyst with 25 years of experience, head of the Bitcoin Foundation and several management companies, presented his set of metrics by which it is worth evaluating ICOs.

Fenton proposes to evaluate ICOs by 10 criteria. Assign between 0 and 10 points to each. Set your own rules. For example, "do not invest in a project that will score less than 75 points" or "do not invest in a project if it has less than 7 security points."

Safety: How technically clean is the project?

Participation: what exactly do you buy (token, coin, API key, share in future revenue or something)?

Accounting and legal accounting: is the project legal? How public? What rights do project participants have? And so on.

Project team: who is working on the project? What did these people do before? Have they ever managed the amounts of funds they plan to raise?

Profit: what income does the project have? Is your token tied to the project yield and how? What market share does the project plan to occupy?

Supply and demand: is the issue of coins/tokens limited? What/who does it depend on? Is it possible to make changes? What is the real market capitalization, etc.?

Usability: What will the token/coin be used for? What will the project do? What problem does the project solve?

Industry/institutional support: Are venture investors or corporations involved in this ICO? Do exchanges support this token/coin? Which business is interested in the project? Does the project have parquets from the industry? Who are the competitors? Is the project an industry leader?

Technical details: does the project really need a blockchain? How long was it tested? How protected is it from editing? How anonymous is the project?

Factor X: Your own criterion for evaluation.

In Paris, presented the world's first ICO charter

European players of the ICO market, together with experts in the field of technological startups and fintech, combined experience in Initial coin offering (ICO), as well as Initial token offering (ITO) and created their own charter^[1].

The first ICO manifesto was developed by an initiative group of representatives of the largest online platforms in Europe, engaged in the promotion of crowdfunding, analysis of startups, search for investors and large technology customers. The team included experts from Avolta Partners, Chaineum, Exaegis, Kramer Levin, KYC3 and Scalene Partners.

The goal of the project is "to provide assistance on issues of growth control of this difficult-to-regulate market," the organizers said.

The Charter is the 10 basic principles of successful, safe, and most importantly, "transparent" participation/maintenance of ICOs. The main message of the document is a comprehensive detailed analysis of startups at all stages, a study of documentation and reputation, an impartial audit with the involvement of third-party experts and prevention of the risks of fraud, terrorism or shadow money laundering.

The authors are confident that their manifesto will help entrepreneurs overcome distrust of ICOs and "freely develop innovation in Europe." The representative of Chaineum expressed the opinion that with the active development and regulation by government agencies of different countries, the ICO phenomenon has every chance to bypass venture capital financing in the future.

10 paragraphs of the Charter:

• Provide information on ICO/ITO projects.
• Independent legal checks of ICO/ITO tokens and their issuers.
• Official documents.
• ICO/ITO Smart Contract Codes and technical specifications.
• KYC, combating money laundering and terrorist phenomena.
• The rise of cryptocurrency and tokens.
• Using ICO/ITO protocols.
• ICO/ITO security and privacy.
• Audit by third parties to calculate project risks.
• Post-ICO information.

Notes