Token sales are becoming more private, and crowdsales are diminishing. The chances of being able to participate in an ICO is getting lower and lower. To be whitelisted, you need to go through a growing number of steps. Companies intend to attract big investors, and these current trends are becoming a challenge for small and medium investors.
So how can they solve this problem?
What’s the problem?
There are some difficulties when it comes to making an ICO investment. Promising projects lean towards restricting access to their sales, and the most successful ICOs – like Telegram and Petro – raised their funds in a private way. Another example is Nucleus Vision, which reached the hard cap of $40 million during the pre-sale.
So, how is it possible to get in at the earlier stages if you aren’t a major investment firm?
A game of pool.
There is a solution: The more investors, the more funds there are. If they will be united into a single community with the right goals and rules, then their chances of investing in promising projects will be increased.
One such union is an ICO pool. This allows for the opportunity for people to make investments together. Along with it, members can research the market, discuss the perspectives of ICOs, share corresponding signals, and much more. It just depends on their arrangement.
An ICO pool lets people collect large amounts of capital and reap certain benefits. Also, all things being equal, it diminishes the risk. Contributions are protected here by the collective experience.
It is possible to distinguish three general types of ICO pools.
- The first is white pools, which usually have top spots in the ratings. They are transparent, supportive of KYC procedures, and they take the local jurisdictions into account.
- Fraudulent pools subsume deliberate scams and unsuccessful ones.
- Hidden pools are difficult to discern. Their general feature is that they are not created for the general public, and many of these can be found on meetup.com (for example, this one).
Aside from this, ICO pools are divided according to the usage of smart contracts. It subjects fund management to strict rules.
In this case, all financial information is sent to a smart contract. These contracts are open source so each can check it before participation. Once that’s complete, the gathered funds go directly to the ICO. Once the tokens have been received, they are proportionally distributed among the investors.
Measuring the reliability
Since there are a lot of the pools, how can you choose the right one?
To verify them, the following factors should be considered:
- How many rounds of token distributions a pool passed?
- How useful were they? This is the ratio of completed rounds and successfully completed ones.
- How good are the projects? Obviously, top ICOs are better, but more often than not, most are on the middle level. Therefore, the quality (and presence) of expert reviews are important.
Choosing the right one.
Dangers are everywhere, and the crypto market remains highly volatile. Anything can happen. Guarantees that the investment process will go according to plan are impossible to make.
Pool creators receive a huge amount of money, and this can make things very tempting. Even if everyone is honest, the risk of a hack or an attack cannot be removed. Though KYC is widely spreading and transparency is becoming inevitable, pools are in a regulatory grey area (but maybe not for much longer). For example, there is no clear answer on whether or not the citizens of countries with restricted access to ICOs can be involved in the pools. If the pool is registered in that place where there are no any restrictions but its participants are from a place with restrictions, is that legal?
Before entering the pool, one should analyze:
- Is it registered as a company?
- Is criticism acceptable there? (in forums, a Telegram chat, etc.).
- How realistic are its claims? In any case, avoid the unrealistic ones.
How to pool?
How did the idea of an ICO pool even begin? What is it worth to be the chosen pool?
They research the market, and after the appropriative project has been found, they set a deal with it. Then, this is announced. The investors can bring their funds. There is the special service on the site for this purpose.
Also, it is emphasized that sub-pooling – or pooling into other pools – is unacceptable to them.
The platform uses their own CRM system. It is possible for each member to propose its own project for investment. But their Telegram group is now very small (they have a dozen participants at the moment) and does not contain any substantial discussions.
Their minimum investment is 0.3 ETH, and their commission is 3-5%, which is dependant on the project. Fees cover gas expenses, research, and marketing costs.
Bulk is very similar to the previous one. The team contacts the ICO, obtains additional information about it, and negotiates special sales conditions. These conditions differ for each case.
There are two important details to look at here:
If the minimum contribution goal is not achieved, Bulk uses re-pooling.
If larger pools are not accessible, the fund is returned.
Their Telegram group contains more than three thousand members. But it is only for Russian, which restricts expansion possibilities.
The minimum amount of payment is very low – 0.1 ETH. The amount of fees vary according to the project – from 0 to 10%.
The working principle and the fee size is structured here in the same way. They seek out a project, evaluate it together with the community, and then finance it. The Telegram channel contains a detailed description of every ICO and specifies the fees and minimal dues for each of them.
The community is big, with over 6,000 members, but those memberships will be closing soon.
EliteClub promises to provide very detailed ICO research and select the projects that are capable to showing high growth. To do this, they employ an algorithm to process the data on multiple exchanges, and they examine any of the patterns that they find.
Members discuss signals, projects, results, and propose their own ideas in the public group. The registration is limited at the moment, and they announced that new rules will be coming soon – the cost for joining will be 1 ETH, with a 0.1 ETH monthly fee.
As in the previous cases, they are not permanent and are made more clear in the Telegram chat.
This recent study states the ordinary returns from the ICO for the first two weeks after being listed on the exchange is 179%, whereas the representative ICO investor earns 82%. Given the careful choosing, increasing the funds twice, or three times over, is achievable.
Moon Syndicate is taking part in the pre-sale of Fetch.ai ICO. The allocated sum, which is intended to buy the tokens, was 1,000 ETH. The received discount was 25%. Each contributor should get a proportional ROI: the more money they give, the bigger the return.
The amount of profit will correlate with how the token will be appraised on the exchange. If the ordinary fee is about 5%, and if the rise in the asset price is almost inevitable (because of the strong selection and the project properties), then the profits should be significant.
Let’s consider another example. EliteClub invests in Tolar HashNet. In this case, there is the higher border – it’s possible to deliver a maximum of 80 ETH.
If the discount is 20%, the fee is 3% and the common growth’s multiplicator is three, then the expected profit can be about 232.8 ETH. Since there are only the proven platforms, they should work out.
Bulk does not give out the specifics of their projects publicly. The last one whose code name is “O.P.” The invested sum is unlimited, but the fee is high – 10%. Plus, other levies are 0,5% for using PrimaBlock service and 5% for Coinlist.
To the pool?
ICO pools are the old solution to new problems. Such clubs can enforce each bidder, and it grants access to a lot of research data, enlarges a finance volume, ensures discounts, and has other benefits.
Nevertheless, there is no guarantee that everything will always go in the right direction. Reality is not obliged to be subject to our plans. Furthermore, smart contracts are very complex and not every investor will be able to verify them correctly. Who knows what mistakes or intrusions might happen. The sharing of money is a question without an answer. Can it be trusted?
Every investment is a toss of the dice – but every toss is not free from interference. Whether it’s good or bad – it is on our side.
But ICO pools can help.