Continuing right where we left off, let’s talk Blockchain Technology and all that is involved in it. This simplified explanation is sure to help one understand this new technology better and open minds for its implementation.
7. What is an ICO?
- An ICO stands for Initial Coin Offerings. What happens in Blockchain Technology, is that once anyone has created an ecosystem, they release its white paper on their site. That is when they launch an ICO. An ICO is basically a means of crowdfunding by the companies behind it. They invite investors to put money based on merely on their words and marketing tactics, in return for the Token that they will create at a nominal price. These future plans include the usage of fiat currency in order of implementing their said algorithm. Here is when it gets tricky. While there is always a benefit of doubt that is given to ICOs may succeed and surpass everyone’s expectations, there are many who go through this entire process with Ponzi style phishing on their minds.
8. Phishing? Ponzi? Are there no guarantees in ICOs?
- As stated above, there is a 50/50 percent chance of how any ICO advances in the future. It can either become the next big thing i technology or it can fizzle out over time or simply put, the company behind it can just walk away with all the funds collected by merely stating that the venture did not success. These risks are nothing new for anyone who has ever invested in the stock exchange or similar schemes. But, there are means in which one can determine if they want to invest in a particular ICO. Systematic study of the White paper, Researching the team behind it, and most importantly, keeping a keen eye on the ecosystem being incorporated helps one protect themselves from scam artists. For more details on ICO scams, do visit this
9. At this rate, isn’t it difficult to separate fake ICOs from the legit ones?
- That’s right! Due to some bad grapes the whole bunch of ICOs are seen with a skeptical eye. The worst part of this is that those who truly have an ecosystem created and merely need funds for the same suffer due to this. There is a whole saturation point that was reached back in January ‘18 after the Bitcoin boom. The side effect of this boom was that every Tom, Dick or Harry decided to launch an ICO. this resulted in more liquidity and utter chaos in the market. Now, as the buzz has settled, one can always study a market and choose an ICO they want to invest in. For more details, check out this page
10. So, apart from the fledgling ICOs and Bitcoin how many other cryptocurrencies are there in all?
- Well, according to Coinmarketcap, there are 1645 registered cryptocurrencies. This number is not limited and grows every day. As Bitcoin was the first decentralized cryptocurrency its Blockchain is pretty big and hence, it has the most popularity and its value keeps changing. Other cryptocurrencies are:
11) Wow! That’s a lot of coins. So, how does one get a cryptocurrency? Is there a particular shop one needs to visit?
- Cryptocurrencies aren’t traditionally sold in stores. They are either Mined or invested in via Crypto exchanges. These 2 processes are the main means of acquiring any cryptocurrency.
- Mining: When we talk about mining, it can be basically be explained as a process where all the transactions of various cryptocurrencies are verified and then added to its Blockchain. This process provides the miners with a certain amount of crypto benefits.
- Crypto exchange: Crypto exchanges are businesses that let you buy cryptocurrencies in exchange of flat money or other digital currencies.
But, apart from the above mentioned 2 processes, one can also acquire cryptocurrencies via Bitcoin ATMs and P2P (Peer to Peer) exchanges. To know more about the different means of acquiring cryptocurrency, read this page.
So we conclude part 2 of our blog. To know more about cryptocurrencies, ICOs, Mining, crypto exchanges and the processes involved, do keep an eye open for the part 3 of our blog on Blockchain Technology.