Guide for launching an Initial Coin Offering
When people are under lot of anticipation towards latest updates about Initial Coin Offering (ICO) which happens to be a lot these days, they wish to just sit down and actively search some useful guide for a while to take all important aspects in launching an Initial Coin Offering (ICO). So it must come as a surprise to no one that people enjoy Important Guide for launching an Initial Coin Offering (ICO), particularly on CryptoEx.
Below is a guide of all of the details we collected about the ICO process, with input from people who have wholly experienced the process first hand. Pre-planning is most important aspect and there is two questions you require to think about first namely what the purpose of the token is and Are you sure want to do an ICO?
Here are few things to keep in mind while thinking through whether your project should do an ICO in the first place:
- All the actions you take will be reflected in the price of the token.
- Your team will get actively bombarded non-stop, multiple times a day, with questions about the price of your token.
- You’ll require being an international company from day one.
- All of your internal team discussions would likely be pushed publicly.
- Would come across stress in trying to build things that are long-term valuable vs. short-term valuable.
- If your product isn’t open sourced already, there would be a huge backlash to become completely open sourced. There is a strong expectation that many blockchain projects are open-sourced projects.
- Primarily cryptocurrency projects are way more public and transparent than typical start-ups, or even traditional public companies.
- Quality blockchain projects look and function much more like open-sourced software projects vs. traditional tech businesses. You and your team would have to decide both whether your application makes sense to be built on a blockchain + you like to operate as a transparent and open company.
Once you are sincerely committed to start an ICO, the core components in planning are respectively as offering, whitepaper, token design, legal, precautions against the inevitable hackers, and being professionally prepared for communication -(website, slack, social, press, interviews, etc.
There would be general questions like how much do you want to rise and what do you want to accomplish with the specific distribution method you are selecting?
For your effective ICO — are you trying to raise the most amount of money? Are you trying to build a broad base of supporters? Are you trying to target a particular profile of prosperous users? Are you trying to incentivize developers to build on top of your platform? Etc.
Other general questions to think about
- Allocation — what percentage are you giving to your team, investors, partners, reserving for the ecosystem, reserving for the company/foundation?
- Where would the money that you raise go to? You must have an annual budget for the next 5 years.
- Do you want a cap? If so what cap will you set? This depends on the amount you are targeting to raise.
- Do you want to do a pre-sale?
If you do decide to do a pre-sale, you’ll also require thinking about what % of allocation is distributed in the pre-sale in relation to the % you are selling in the crowd sale.
Primarily you want to have a well thought out and crafted offer in which all of the information is presented to the person looking to participate in your ICO.
- What currencies would you accept? (BTC, ETH, anything else?)
- Do you wish to do a pre-registration?
- Do you want to do the KYC process yourself or utilize a service like Civic?
- Do you like to split an even number of tokens for all registrants or via first come first serve?
- Will you be offering rewards for getting in early?
- How long will your offering be for? (1 day, 3 days, a week, etc).
- Will you be geo-fencing?
- Will the tokens be released right after the token sale is complete? If not, when?
- Will you permit funds/institutional investors to invest or only individuals?
Everyone knows that whitepaper is where everything above comes together and is synthesized in one key document. The whitepaper must cover all of the inner workings of your application, how the whole system works, and how the token will be utilized within the system. It must comprise all of the technical details about your project, all of the token allocation details, and all of the respective details about your team.
You would certainly require reputable law firm who has experience with incorporating blockchain companies/foundations and running an ICO process to actively advise you on your process.
The communication strategy for your team would include all of the channels you will utilize to communicate about your project – website, whitepaper, slack, social, etc. All of your channels require being in sync, your whole team needs to be on deck, and you require responding to people on time. Here are some of the key components mentioned below.
- Landing page for the crowdsale
- Each team member require a clear and updated LinkedIn profile since prosperous contributors would be doing due diligence on each member of the team.
- Advisors require updated LinkedIn.
- Red flag to contributors is when there are more advisors than team members.
- Can include in whitepaper or as a separate section on the website. Roadmap is also necessary and could include in whitepaper or as a separate section on the website.
- Token allocation — require being transparent about what you are selling, terms of the ICO, and terms of the pre-sale (if applicable).
- Contribution details would be released when the ICO/pre-ICO is ready.
- Links to social accounts
- Setup a newsletter on your website.
- Must have a updated blog ideally with a history of posts already
- Should have an updated Twitter account.
- Press — getting into both crypto publications and general news.
Need of Internal communication channel (Slack, Rocket Chat, Riot, etc)
- Need to have a main communication channel and the team require being active there.
- Appoint quality community manager where he also acts as the bridge between the larger community and your internal team.
- Try to setup the channels properly and moderate heavily. The channels generally are Announcements, Developers, General, Random, Support, and Scam Alerts to be able to notify all users of potential scams
- The main channel that teams use effectively right now is Slack
- Need to have staff people ready to answer questions, all of the time.
- The more successful your ICO is, the more community support you would require.
- More importantly you want to have a sustained presence on the web well before your ICO, during your ICO, and well after your ICO. Potential contributors require to know that your team is serious and in it for the long-term.
Smart contract / Blockchain / Wallets
- What blockchain would you be using? ERC20 token?
- Require to develop the smart contract well in advance.
- If you do a pre-sale and ICO, you’ll require two smart contracts
- Security audit on the smart contract
- Go for multiple parties who do their own independent audits and publish all of the individual results.
- Need to setup the wallet you will receive the ICO payments.
- You might require more than one setup.
General security tips
- Buy all of the website domains that look like yours, and all of the several TLD variations of your name.
- Hackers will try to re-create your landing page with a domain name that is similar to yours, utilizing their own address instead of yours. So you require being on the lookout for any potential scam leading up the ICO and even after the ICO.
- Register all of the social media accounts of all of the names that look like yours.
- Hackers will also try to copy and spoof your social media accounts and point them to a different landing page than yours. So you should lookout for this even after your crowdsale is over.
- Actively setup cloudflare on your landing page.
- Setup two-factor authentication to make changes to your website and monitor your site extensively.
- Follow two factor authentication setup of your own internal team also
- Turn off the Slack API
- Tell people to bookmark on your site and don’t click on links.
- Don’t release your wallet public address until the day of the ICO
- Remind people not to send in their contributions from exchanges like Coinbase.
Cautions after the ICO
Where are my tokens?
- Develop a tutorial video for all combinations of wallets and post it to all of your channels.
- For the people who sent their contribution from an exchange, you’ll require to respond back to them.
What exchange are you going to be listed on? When?
- Most exchanges have an application page, if you like to be listed on them, start building out these relationships early.
- Several exchanges will list your token for sale regardless of whether you want to or not.
- Write a blog post afterwards.
- Give an update shortly after your ICO is completed.
Effective Fiscal policy
It is the policy of buying, spending, and freezing, discounting, and burning of tokens. If you retain a lot of tokens in the treasury, people wonder when those will flood the market. If you pay people in tokens with no vesting, they could dump them. If you pay in locked-up tokens, you will also have to supplement those with some cash. All of this requires good communication, so people know what’s coming.
Monetary policy is concerned with how many tokens there are, how divisible they are, and the inflation/deflation policy you have set. You require to be transparent with the policy you set, and if you ever make any changes to it.
Once you increase your funding through an ICO, you’ll require deciding how much of your contributions cash out into fiat, and how much to stay in crypto -if any. You must decide this before you complete the ICO.
Finally following all of the above guidelines make an ICO successful, but professionally it shares better insight on the process as a whole from the perspective of the project team owners.