Frequently Asked Questions
We’ve carefully selected some of today’s most asked questions about ICOs and cryptocurrencies.
ICOs must go through a transparent selection process before the audit begins. Our open source scoring system was developed to assist ICOs who are providing solutions to real world probems.
Our dedicated team is transparent and trustworthy. We've fully audited over 50 ICOs and have the experience and knowledge to guide ICOs.
Pump and dump schemes are indeed a clear and present danger as far the ICO scene is concerned, which is why vigilance on the part of the investor is required so as not to fall victim to scams. To be sure that an ICO isn’t a scam requires a lot of investigation into the many important criteria. You have to look at the token implementation plan, the solution being provided by the service launching the ICO, as well as other legal and economic criteria like business model, technological framework, and marketing strategies. The white paper is always a good place to start and it is never a bad idea to get professional help. That is where being part of the TruDex community becomes of great benefit.
The market is still incredibly young for anyone to feel like it’s too late to invest in ICOs. The trick is to find an ICO worth investing in and to understand the dynamics of the market. With the volatility of cryptocurrencies being so high, massive price fluctuations are to be expected. Bitcoin, Ethereum and all the other cryptocurrencies available today have yet to scratch the surface of the seemingly limitless possibilities that blockchain technology and cryptocurrencies have to offer. While it may be too late to invest in bitcoin mining for example, there are other viable opportunities in the crypto market that are springing forth every day.
It takes research and a lot of due diligence to determine the viability of a cryptocurrency. The basic truth is that a cryptocoin must be servicing a need in a way that is unique. This is the only way users will participate in it. Without user participation, the coin will quickly become devoid of value. Finding accurate information can be a little tricky when it comes to cryptocurrencies and that is why TruDex provides concrete information on cryptocurrencies including but not limited to business models and blockchain operating protocols. All of the information contained in our database is regularly updated to reflect current trends.
ICOs have become the principal way for many startups to attract investor funding for projects that are based on emerging blockchain technology. Due to the loosely regulated nature of the crypto market, ‘pump and dump’ schemes have managed to saturate the scene. These are basically ICOs run by startups who inflate (pump) the value of their coin tokens to entice investors and once capital has been raised, they dump the valueless tokens. This leads to investors losing money and confidence in the ICO market as a whole. These schemes have no tangible market viability and their base technologies do not represent anything cutting edge. However, to the cryptocoin neophyte, and maybe even the consummate crypto investor, identifying such schemes might be a little tricky and that is why a partner like TruDex is of paramount importance.
Many governments around the world are still coming to grips with cryptocurrencies and ICOs. The common denominator is the fear that is based upon the anonymous nature of cryptocurrency transactions, which makes ICOs an avenue for money laundering and terrorist funding (ML/TF). While some governments take a hostile stance on ICOs, many like Singapore and Japan, are looking at ways to effectively regulate the market. China has placed a blanket ban on ICOs but experts believe it is only temporary with the main consensus being that the Chinese government is working behind the scenes to create a more tightly regulated framework for ICOs. In the United States, the only significant piece of government intervention has been the ruling by the SEC that some ICOs are actually tokenized securities. States like New York have passed laws that make operating an ICO campaign virtually impossible. Whatever the case may be, most governments are coming to realize that regulation is a much better solution than the outright banning of ICOs. The tricky part is how to regulate without jeopardizing the decentralized nature of cryptocurrency operations. As an investor, you need to be well informed as regards to government policies related to ICOs and at TruDex, we have got you covered.
All you have to do is find a reputable ICO that is open to investors who live in or are citizens of the US. There is no law that prohibits citizens or residents of the US from investing in ICOs. A lot of ICOs that you may find on the internet aren’t open to citizens/residents of the US because US laws require Startups who are launching ICOs to register with the SEC. At TruDex, we provide relevant information on any ICO campaign so you can always know if it is available for investment in your country.
One of the main causes of crypto volatility is the small size of the market. Even Bitcoin, the clear leader in the field, is still very much in its infancy and small movements within the market can cause massive price and value fluctuations. There is also the fact that on the whole, the market is still being driven by public perception. Therefore, in periods of great internet hype, prices go up, demand skyrockets, and short-term investors sell off, which dramatically reduces the price and the cycle continues. With increasing adoption and the creation of a better regulatory framework, a more balanced market more similar to that of traditional fiat currency can be achieved.
There are seven categories in the TruDex scoring system:
• Real World Problem/Solution
• Team Strength
• Business Model
• ICO Details
• Token Strength
With this broad approach to ICO scoring, we are able to hit upon over 50 criteria, each one meticulously scored in our transparent process and weighted by their significance. When you read our pro report, you can easily see the strengths and weaknesses of each ICO and make your determination.
Many ICO investors that are new to the industry may spend hours upon hours watching videos of cryptocurrency influencers giving their opinions on what to buy into and what to avoid. Or they scour Steemit, Reddit and Facebook groups looking for answers from strangers. All this time can be saved by seeing for yourself how an ICO holds up in our database. TruDex completes exhaustive, in-depth research using each ICO’s website, white paper, press releases, articles and social media and forum activity, and then organizes all of it so it’s easy and quick for investors to digest.
The majority of people now entering the cryptocurrency space are not techies, and even those that are may still have some catching up to do in learning learn blockchain technology. Finding the perfect site to offer you unbiased, well-researched ICO and cryptocurrency data is the key to making smart investment decisions. That’s what TruDex seeks to create.
It is accurate to characterize ICOs as being a bubble. While they may have a lot of advantages, especially considering the ease with which they allow for the monetization of open-source projects, a lot of the startups launching these ICOs are not sustainable. Many are doomed to fail, just like the way the housing bubble of the early 2000s was a ticking timebomb. It does not, however, mean that there will be a catastrophic system-wide failure. The growth potential of Bitcoin, Ethereum and a host of other cryptocoins as well as the diverse economically viable applications that blockchain technology can be put to, suggest longevity across the entire market.
Being very much in its infant stage, it is normal for there to be a lot of fear and uncertainty surrounding ICOs. Some governments like China have placed a blanket ban on ICOs in a bid to curtail the activities of fraudulent individuals. The market is still volatile and unstable with massive price fluctuations. There are still quite a number of grey areas that experts still haven’t come to a consensus on and the wealth of online articles do not do a good enough job of breaking down some of the more complex concepts. ICOs have been given a bad tag as being conduits for money laundering and terrorist funding thus scaring people away. As cryptocurrency acceptance grows and they become more popular in mainstream use, the level of fear and uncertainty should see a reduction.
ICOs present a much easier crowdfunding mechanism than has been previously possible. Rather than jump through the hoops of convincing banks and venture capitalists to provide the funding for the business, entrepreneurs can create smart tokens which can be sold to investors to raise capital. Disruptive technologies become better with increasing acceptance. An increase in ICO volume creates a stable ecosystem that pushes the balance of corporate finance from the mainstream end to this new wave of ICOs. ICOs also encourage investors to become early adopters of whatever platform applications a new business is developing. This means that such businesses will start up with a considerable customer base that are invested in the success of the venture.