These days, the ICO market is not in the best condition because more and more projects postpone token listings on stock exchanges for an indefinite period or they generally get shut down. ICO investments are getting riskier but there are those who are guaranteed to make a profit in this market.
We will tell you who and how do they profit from ICO in reality.
Developers
Teams that hold ICO raise funds for the development and promotion of their project. First of all, however, these items of expenses include the salaries of employees, which they set at their own discretion. Secondly, nothing prevents the development team from spending money on buying apartments, cars and luxury goods, while the project itself will be financed with whatever remains. After all, there is no control on the part of investors and the teams can always claim that they did not succeed or did not have enough money. They’ll go with another ICO saying they’ll be able to finish everything on the second attempt.
Cryptocurrency exchanges
The majority of cryptocurrency exchanges support the ICO-token trade. However, it costs money to add new coins to the marketplace. Each stock exchange maintains its prices individually. According to insider information, token listings can cost from $100 000 to $1M, sometimes even more. It all depends on how much money was raised during the ICO and how popular the cryptocurrency exchange is.
Part of the payment for coin listings are accepted in ICO-tokens. When the coin listing is launched, the token price rate goes up, and the stock exchange uses this momentum to profit from the high price rate by selling the tokens. By the way, ICO projects are following the same routine, as in almost every developer deposits a part of the tokens to their own wallets.
ICO-trackers
ICO-trackers are websites that can help you track the ongoing ICOs. This is certainly a useful resource where you can view the terms of token sale, their cost, as well as information about the project and the following reviews. It is a very convenient tool for investors, but there are subtle details that you should know about.
ICO-trackers tend to to put on their own evaluation for projects, allegedly based on expert feedback. These reviews are sold for money, so even the most outspoken SCAM can get a high rating.
There’s no point forgetting about advertising. If the ICO ad banner is placed on the main page of the tracker website, it doesn’t necessarily mean that the project is good, it’s just that someone paid for additional promotion.
Advisors
Adviser is...well...what it is — a consultant. As a rule, such people have a certain authority in the cryptography, so that ICO projects invite advisers to their teams for good looks.
Now, there are many professional ICO-advisers who jump from project to project and offer their services. We won’t confirm anything, but we do have high suspicions that most of the advisers do absolutely nothing apart from giving the go-ahead for including their membership on the ICO website. What we can confirm, however, is that such services are not free and are paid by the investors.
Pools
ICO Pool is an organized group of investors, which jointly acquires the ICO tokens. Having entered into such a pool, you can buy tokens at a discount of 10%, 20%, or even 30%. In addition, some projects agree to cooperate with large investors only, making participation in the pool to be the only way to overcome the entry barrier.
As you may have guessed already, ICO-pools not only offer a joint token purchase, but they also make a profit this way. The pool organizers commonly take a certain percentage of the raised funds for their work. Moreover, the pool managers can go dark: for example, they can promise to investors the sale of tokens at a discount of 10%, but in fact, they could have received a 15% discount, making a profit from the untold difference.
It is beneficial for Pools that the ICO they back is profitable. They can then increase their reputation and consequently raise even more money for another project. But if the bet turns out to be wrong, the managers are always in the black at the expense of their commission fees.
And then there’s always a probability that the chosen pool will be a scam and its organizers will simply run away with other people's money. That’s why you should carefully check those who are going to look after your finances.
ICO-agencies
If you only have an idea, and you don’t know how to write your White Paper, launch your own website, create a token and launch an advertising campaign for your ICO, then a special promotion agency may come to the rescue. These are professional teams that are ready to take on almost all the ICO challenges, but such services cost a lot of money.
Holding a turnkey ICO is a good option, both for the project team and for its investors. The former can focus on product development, and the latter are more likely to profit from their investments. And the ICO-agency also makes a profit. In the end, everyone is happy.
As you can see, ICO is not simply a token trade, but rather a whole industry which streams a lot of money.