An initial coin offering (ICO), also known as a digital token sale or crowdsale, is a way of raising funds from the public for the development of a product outside of the traditional VC world. Usually products are blockchain-based technologies, but the crowdsale model is increasingly being used for other kinds of projects as well. Each project creates a new cryptocurrency in the form of tokens, which are then sold to the public to raise funds for project development. If a product successfully completes their ICO funding goal, their tokens are distributed to those who bought them and they become tradeable on the cryptocurrency market. If the product itself is then successful, these tokens can potentially become very valuable (ex. this is what happened with ETH, the computing platform Ethereum’s coin, which was originally sold to the public as tokens during the project’s own ICO)

A token is a digital asset that is sold to the public during an ICO campaign, usually for other popular cryptocurrencies, namely BTC or ETH, or sometimes directly for fiat currency. Unlike a cryptocurrency, tokens usually do not have their own blockchain, but rather are hosted on another blockchain, such as Ethereum’s. Once an ICO campaign is complete, the token developers can release the tokens on an exchange, where they can be traded and fluctuate in value, like any other cryptocurrency. Tokens can also have other functions that are particular to the product that issued them. However, tokens themselves do not necessarily give rights or equity to the product/company that originally issued them -- in that sense tokens are definitively not equal to shares in a traditionally structured company.

When you contribute to an ICO, there is never a guarantee that the product whose tokens you’re buying will succeed, either with their ICO or in their future development. Like any crowdfunding campaign, people should think of contributing as a donation to a project in support of its potential development, and the tokens as a kind of reward for your support. However, in the case of an ICO campaign, your reward (tokens) has the potential to increase in value once the tokens are released and available on exchanges. Bottom line, each particular ICO also has their own terms and conditions for contributing, so be sure to check those out before donating.

ICObazaar is a platform for ICO research and crypto market insight. We list, rate, and review upcoming, ongoing and past ICOs with the help of experts in blockchain, cryptocurrency, finance, business, and angel investing. We also capture the dynamics of the crypto market via Metaindex, our real-tim index for cryptoassets. At your request we’ll send you email notifications on specific campaigns as well as market opportunities and more general updates from the crowdsale world.

There is no right answer to this question. Potential investors (you) need to use all the information available to make your choice about contributing to a project during its Initial Coin Offering. Investors should look for project creators who present a clear plan for how their project will be developed and who ideally have a history of successfully completing other projects and ventures. Creators are encouraged to share as much background information as possible so that potential supporters can make more informed decisions about the projects they contribute to.

There is a review section at the bottom of each Upcoming ICO’s project page. Registered ICObazaar users can rate any upcoming ICO listed (with 1-5 stars) and leave a review of whatever length and rigour they should choose. Of course, we encourage users to research projects and write reviews that they themselves would find helpful when deciding whether or not to invest in a given ICO.

If you haven’t heard, we have a reward system for ICO user reviews. The idea is to reward (in ETH) users for producing reviews that are genuinely useful to other potential investors (users). But how do we know? We have two types of rewards: 1. ICObazaar’s choice - for every upcoming ICO, we choose one review that we determine to be of the highest quality and value. The reviewer we choose receives 0.1ETH, deposited into their ICObazaar account. Their review is also marked as 2. In the case that there are at least 10 reviews for a given ICO, we distribute ‘user’s choice’ rewards. 0.4 ETH is distributed to the top 4 reviewers, according to the number of upvotes they have from other users. 1) So, what’s all this buzz about the Pre-ICO? The purpose of our Pre-ICO round is to ascertain community interest regarding our platform and obtain pre-seed funds for our aggressive marketing strategy plan. This will allow us to avoid traditional venture capital funding, and still obtain the some leverage before launching our full-blown ICO. 2) Okay, but why should I participate in the Pre-ICO instead of the ICO? Firstly, you will be one of the early investors showing us your support and enthusiasm about the project. Secondly, you will be able to buy the tokens at a bargain price (0.03 USD per token) — c’mon! 3) I am a US citizen. Can I participate in the ICO? • Unfortunately, no. US citizens and residents are not allowed to participate in the ICO due to US Security Law restrictions. We wholeheartedly respect all country laws in all locations we operate, and urge you to obtain more information regarding specific financial laws in your jurisdiction.