Blockchain Expert and Minister of Information of the World’s First Decentralized State Built on Blockchain Decenturion Nikolay Evdokimov believes that an investor can quickly assess any block-startup by analyzing the main aspects of its activities.
The most important issue is the legal component, since the distribution of risks depends on the future of the startup, tokens and all contributors… Evdokimov believes that a kind «homework» according to estimates, every potential investor can and should do.
This is about three tests: test for «similarity» (family resemblance), test for «venture capital» (risk capital) and the Howey Test conducted by US regulators. These tests are not applied, but as few markets can match the size and liquidity of the American one, startups planning ICOs in other countries try to adhere to the criteria laid down in these tests..
In particular, the investor should make sure that the project does not support future earnings, assets and token ownership analysis. This means that they will not be equated with shares and will be left on exchanges without direct regulation..
Such intentions on the part of regulators are not uncommon. For example, just a few months ago, the US Securities and Exchange Commission (SEC) considered the issue of classifying ether as a stock. Positive decisions were feared by investors and companies working with the coin, as it could lead to colossal changes. In addition, laws on digital assets have not yet been adopted in Russia, so it is not known exactly how the government will relate to security tokens..
Expert recommends pay attention to the marketing campaign carried out during the ICO. It can be the most exciting thing in the entire existence of a startup. During this period, fundraising takes place, so the effectiveness of promoting a direct impact on the number of potential users and turnover. All this will determine the level of the token economy and the cost of the project. To assess this indicator, analyze the publication in leading crypto-media, business publications, the Internet and their content, as well as the correct choice of target audience and the ability to bypass bans.
«ICO — this is such a small prelude before running a real, long-term business. That is, this is the first step, and by this step you can determine the competence of the startup team», — He speaks Nikolay Evdokimov.
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One of the striking examples is the EOS ICO. Just think, the startup has been raising funds for a year without a finished product, indicators of the real effectiveness of the token, other projects based on it, and without development plans after processing the collection. Instead, every promise of EOS was written by the media, famous people about the message. As a result, over $ 4 billion was raised in a year, with only a quarter of this amount for the development platform.
An equally important indicator of safety and future prospects is the technical side. It reflects the team’s level of competence and development prospects. The platform on which the ICO is held is important. The expert believes that using Ethereum is optimal, as it makes it easier to list on exchanges and support other applications…
You also need to pay attention to the presence of smart contracts and multicurrency fundraising. Limiting negative factors triggers negative comments in chats. In parallel, you need to pay attention to advisers, team composition.
This will help to quickly and efficiently assess the potential, level of risks and prospects of any blockchain startup. However, pure analysis needs to be interpreted correctly. Nikolay Evdokimov talks about this and other features of cryptoeconomics in his youtube channel.
Appreciating startups is critical to the well-being of agents. According to a report by the consulting company Cornerstone Research, more than 6% of claims in the field of financial and securities for 2018 is associated with IPOs and cryptocurrencies.
text: Ivan Malichenko, photo from the personal archive of Nikolai Evdokimov
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