How is ICO price calculated?

How is ICO price calculated?

For instance, the ICO price is dependent on the amount of money they wish to earn during ICO (ICO hard cap), the total number of tokens (max token supply), number of tokens to be allocated during the ICO and after (token sale allocation), expected market capitalization, ICO length of time, lockup periods and bonuses.

How the price of a token is determined?

The most effective way the price of a cryptocurrency coin is determined is by its demand. Conversely, if a coin has a high token supply with little demand, then its value will drop. Other factors that influence the price of a crypto coin include the level of token utility — i.e., how useful the token is.

What is a ICO token?

What are Initial Coin Offerings? ICOs are another form of cryptocurrency that businesses use in order to raise capital. Through ICO trading platforms, investors receive unique cryptocurrency “tokens” in exchange for their monetary investment in the business.

READ ALSO:   Does Amnesty International work in China?

What is the difference between an ICO and a token presale?

Cryptocurrency investors should understand the difference between an ICO and a token presale. A token presale occurs prior to an ICO launch. In a presale, the startup offers up tokens while they are still under development before they are available to the general public.

How to calculate the price of token during an ICO?

Given that, we can calculate the price of token as follows. First we take those 5 steps. Decide on a time window (e.g. monthly). Set the total number of tokens M. Set the expectations factor. We can easily assume that at the price of the token is equal to the sale price during the ICO.

What is a pre-ICO in crypto?

Pre-ICOs let crypto investors buy the necessary tokens at a discounted price before the official public sale. Usually, projects keep their digital coins price very lower. The funds raised this way are most commonly used to make next promos, marketing campaigns, or develop the MVP.

READ ALSO:   What is a good question to ask a physicist?

What is pre-ICO and ICO price?

Pre-ICO and ICO price is based around the governing organizations valuation of a project. It really comes down to how much they want to raise and then take this amount and divide it by the amount of tokens provided during the ICO (making allowances for discounts).