If you have been following the latest ICO news, then you must be getting the updates regarding the ongoing developments in ICOs. But have you ever heard of pre-sale ICO? If not, then no issues, because most of the people who are familiar with cryptocurrency don’t have much idea about it. But if it is co-related with ICO, then it becomes important to gather knowledge about it.
A pre-sale ICO is a situation when the selling of the group of coins takes place before the ICO by a token team. People can be found much interesting to know about tokens at the beginning stage, before any hype surrounding retail take place. If you aim to experience gains one after another, then it becomes important to discover tokens in the early stage.
These pre-sale ICOs do not only provide benefits to investors but also give an advantage of instant funding to the development team. Besides this, it is also helpful in creating buzz regarding Initial Coin Offering. But it does not seem so flowery, as it appears to be. We are saying this, because of the threats and drawbacks involved in it. If you have been reading blogs on cryptocurrencies, then you must all probably know about the concept of ICO as initial public offering activity for digital currency. When the tokens are available publicly, investors take benefit of this opportunity by buying them. They mostly go for big choices like Bitcoin and its closest competitor Ethereum. Buyers are in awe of fresh token that could prove worthy as a good fortune for them. Where instant required funds meet the need of a development team, a pre-scale ICOs lands everyone in a difficult situation.
A pre-sale ICO is like a cousin to ICO with different characteristics. It shares some conceptual similarity with ICO during its appearance in a few months. Money is swapped for tokens by the early enthusiasts. You might be familiar with the benefits of ICOs, but you are unaware of the fact that the advantages of ICOs dwell on pre-sale. Buyers who are holding tokens aim to churn out bigger profit from it. Funds which are given to development teams happens in the most crucial time. It took much time in generating of the coin during the early days. It all included penning software, promoting a token, recruiting new employees. For a useful cryptocurrency, funding is essential. So in that case, a pre-sale ICO will provide you with a good back-support for financing in necessary need.
Risks Involved In Pre-Sale ICO
Now as we mentioned earlier, that concept of pre-sale ICO is not all flowery because it has its downsides and risks, both for the development team as well as investors. So it all indicates that all those pre-sales tokens which are hold by buyers have no worth at all. With the appearance of real ICO, the excess of available tokens might lead to downward value. Development teams must take responsibility to alert investors with short-sightedness. It has been noted that after an ICO, buyers in pre-sales ICO steps back and discard the tokens. Even though it promises you with profit, still, it doesn’t seem okay if the tokens are sold off at the initial attempt. In cryptocurrency, ICOs can either prove successful or failure. Circulation of any bad news can affect the coin in the most crucial period.
Conclusion
Pre-sale ICO is beneficial not only for investors but also for the development team in terms of providing instant funding. But with advantages, comes risks too. It is important to understand that pre-sales are often vulnerable to big investors and whales. Most of the available tokens can easily go into the large pocket of these large investors. Much akin to ICOs, pre-sales comprise both risk and rewards on a bigger level. So it is big advice for both investors and the development team, not to trigger for pre-sales blindly. Think hard in place of taking a hasty decision. To know the latest ICO listing, stay abreast of crypto news.