Trading Cryptocurrency ICOs: What Is The Upside?

Penny stocks or pink sheet issues are traditional favorites of adventure seeking investors. In much the same vein, the world of cryptocurrencies presents a constant supply of freshly minted ICOs to leverage-friendly bargain hunters.

If you are interested in taking a risk-on approach to the cryptocurrency markets, then playing the exploding ICO market may be for you.

ICOs Present Big Risk And Big Reward!

I discussed Initial Coin Offerings (ICOs) in an update from last week. Basically, they function as a way to raise money for cryptocurrency firms, similar to a stock’s Initial Public Offering (IPO). However, there currently is no regulatory body so proceed with caution!

Frequency And Variety

New ICO offerings are coming across the wire on a constant basis. Nearly every other day brings a fresh one and the opportunity to invest in a budding cryptocurrency firm. 2017 has been a banner year for ICOs, with 140 launches raising over $2 billion.

When it comes to trading options, ICOs offer considerable diversity. A wide variety of services are represented by ICO entities, based largely on blockchain technology. Commerce, artificial intelligence applications, commodity/cryptocurrency standardization, and entertainment are just a small sampling of the core businesses behind ICOs.

Getting Started

Having access to information is a crucial aspect of trading. That is where ICOs can be a challenge. With no real media outlets or regulatory bodies to vouch for a firm’s authenticity, fraud is a considerable factor in the market.

The use of a social trading platform can help in avoiding scam artists and false ICOs. Also, a study of each firm’s white papers may shed some light on the intent of the business.

Bottom Line: ICOs and cryptocurrencies are quickly becoming a large part of the contemporary financial system. In order to engage them from a position of strength, be sure to perform your due diligence.  

ABOUT THE AUTHOR See More

Shain Vernier

US Analyst

Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.

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