One of the most important questions for those who are looking to invest in a new cryptocurrency is when they should buy them. Whenever a new crypto is developed, the team behind it will start selling the tokens in ICOs (Initial Coin Offering). However, the question remains – is it a good idea to buy cryptos during this time? Let’s take EOS as an example.
It has been almost a year since EOS announced that it will hold a token sale in an ICO. Many have wondered whether or not to buy the tokens during this period, and what might be the consequences of their decision, one way or the other. To understand this, first, you need to learn how investors think, what they do, and how many coins do they get when they make a purchase during an ICO.
How do ICOs work?
When the sale initially starts, there is usually a certain period of time (5 days in EOS’s case), during which the first 20% of the mined tokens are available for purchase. In case of EOS ICO, this amount was 200,000,000 EOS tokens. The rest of them (800,000,000) were to be split evenly in one-day windows during the next 360 days. Basically, this meant that EOS will be selling 2,222,222.222222 tokens per day for the entire year.
Now, since you can only buy EOS with Ethereum (ETH), your gains will depend on how much you invest. If there are 20 EOS tokens available, and one person invests 4 ETH, while the other only contributes 1 ETH, the first investor will get 16 EOS, due to the fact that they contributed 80% of the contributions that were given in total.
Now, this is an easy thing to understand if there are only two contributors to the token. If there are more people investing, then each contribution will carry less weight, which will result in lower gains. This is why the biggest risk when it comes to buying tokens is during the initial 5 days of the sale.
This all can vary a lot from token to token, as well as from ICO to ICO. There have been some ICOs that were completely sold out in a matter of minutes. Some even took only seconds before the supply of tokens was drained completely. This is often the case when large corporations join in, and there is basically no room left for individual investors to join in on the sale.
This is why EOS did things differently so that even the small investors would get their chance to participate.
When to buy tokens?
The timing of the token purchase is the most important thing, and to figure out when is the best time for you to make a purchase, you need to understand what other investors will do. You can get a hint by following what people are saying on social media. If the ICO receives a lot of positive hype, then buying the tokens as soon as the sale begins will probably result in receiving fewer coins, since the demand is so high.
If others seem uncertain, and the ICO doesn’t receive that much attention, the chances are that the return for the early purchase will be much higher. The thing about making this choice is that there is no certainty when it comes to the outcome. All you can really do is try and find clues in the media, and keep an eye out when it comes to the general mood of the other investors.
Those who are uncertain at first will probably start buying coins at a rapid rate after the first few days, which leaves you with an opportunity to get great returns by joining in early. This method works pretty well when it comes to large companies as well. After all, you are only one investor, with limited resources, and a small amount of money. That means that you probably can’t buy that many coins, but it will also make your losses in case of a bad decision much lower.
Companies often have millions that they are planning to invest, and if they make a wrong move, their losses will be significantly higher. Because of this, large investors and companies will often be uncertain and will choose to wait and see how things turn out. This is the perfect time for smaller investors to make their move, and take advantage of the situation.
Getting in early is a good way to get high rewards for your investment if you are willing to take the risk of making a wrong call. However, if you are not after high returns, and are simply looking to make a good, stable investment that will have positive consequences, in the end, you should definitely wait and see how the things turn out.
How to tell if the coin is a good investment?
Deciding whether or not to buy a coin depends on a lot of things, so you will have to do some research in that regard. You should try and find out what you can about the coin, including its developer, his previous projects, and their success, as well as the coin’s goals. A lot of the coin’s future depends on what its blockchain can offer, but also its own features.
Apart from that, if you are willing to wait before investing, follow the situation, sign up for the token’s official newsletter, and follow the team’s announcements on social networks. Twitter and Reddit are a good place to hear other people’s thoughts as well, so keep that in mind before making your decision.
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
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Reasons Why You Are Much Safer When Crypto Trading on Dexes
While many cryptocurrencies aim to bring the change to the world by bringing full decentralization, one aspect of the crypto space still remains mostly centralized, and that is the way they are exchanged. Most crypto exchanges are centralized companies, where traders and investors need to deposit their coins for safekeeping. This is a risky way to handle the funds, as exchanges remain susceptible to hacks and theft, as many realized recently, after the hack of the world’s largest exchange by trading volume, Binance.
During the hack, around 7,000 BTC (over $40 million) was taken, and sent to multiple wallets, never to be seen again — for now, at least. The hack also came as quite a shock, as Binance was known for its efficiency, security, and high levels of confidence. It also made people realize that their coins are not really theirs if they need to rely on third parties, such as exchanges, to keep them safe. As a result, many are now turning away from centralized exchanges, and are heading towards decentralized ones — also known as DEXes.
Here are some reasons why you might want to consider doing the same.
1. True ownership of your coins
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Crypto Billionaire Predicts Massive Price Growth by 2021
Crypto prices are once again going up, and Bitcoin has just passed a major resistance level at $6,000. With a situation like that, it is not surprising that everyone in the crypto community is looking forward to the future, wondering what to expect in years to come. Many experts have already given their predictions, some more optimistic than others, but almost all bullish.
Crypto billionaire Mike Novogratz has always been very supportive of cryptocurrencies, and very bullish on Bitcoin. He recently stated that he sees the coins’ prices triple in the following 18 months, meaning that Bitcoin’s return to $20,000 might not be far away, according to him.
He noted that Bitcoin is back to $6,000 after its price hit as low as $3,100 only a few months ago. These days, Novogratz does not believe Bitcoin will return to such lows unless there is a devastating exchange hack or a major shift in regulations. Of course, there was a big hack that had the potential to damage the coin’s price, only days ago. The world’s largest crypto exchange by trading volume, Binance, saw a significant security breach which resulted in a theft of 7,000 BTC.
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Corporate executives are turning to blockchain technology more than ever in an attempt to revolutionize the business world. Although blockchain is still a relatively new concept, that hasn’t stopped more and more companies from jumping on the bandwagon. This hot new technology has quickly gained a reputation for providing greater transparency, enhanced security, improved traceability, increased efficiency, and low costs. One industry that could certainly benefit from decentralization is the online gambling market, specifically, online casinos. TokenRoll (TKR) has developed a platform that appears to offer a promising alternative to centralized casinos.
Problems with Centralized Casinos
The primary reason why blockchain technology is being implemented so quickly is because it solves a lot of the problems typically associated with the traditional business model. And online casinos are no different. It still needs to be said that centralized casinos have proven that there is a great demand for online gambling. The market is growing faster than anyone could have predicted, and future opportunities appear very promising and lucrative. But industries are continually evolving and this one is no different.
A few of the problems facing centralized casinos include the following:
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- Consumer lack of confidence
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- 48-72 hour wait time for withdrawals
These are four monumental issues that need to be addressed quickly given the global growth of the market. Casinos need to…
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