Topic: Why ICOs impose a minimum amount on investors? - page 3. (Read 592 times)

Because if the price is higher, investors will bypass such projects and will look for other projects. It is not profitable to lose your investors

It should be borne in mind that at the same time there is a limit on the maximum payment in order to protect the coin network from whales. And the minimum level is set in order to attract serious investors who are interested in the real promotion of the project. The project is not interested in students who will buy coins to sell them immediately after the ICO.

Minimum sales must be achieved because it becomes a valuable capital to run the ICO project. There may be projects that maximize sales because they already have the funds to develop the project. However, this has become the policy of the Development Team. We as investors must certainly be more careful in investing.

because anything that has been planned by the team in an ICO project has been carefully thought out by the team so that the maximum and minimum targets must be targeted so that in the future the project can run according to expectations and the funds obtained are not misused by the team.

yes the project must also need a minimum investment so that their project can run smoothly.
but with the current situation like many left behind

The minimum investment amount is required in all ICOs. I believe that the minimum amount to eliminate small investors is because they are not ready for the requirements and risks that ICOs may have. I also know that the minimum amount is to attract larger investors.

Not well regulated ICOs impose this kind of thing on their project cause if they are they will welcome any amount from the investors and would really fasten to reach their minimum capitalization for the project. I checked Poseidon and Etainpower ICO and is a good project caring for the environment, how about that bitrus?

I think the reason is because the costs required to send a token to an investor's wallet are large, so if investors only invest $ 1 then the project will experience a lot of losses and another reason is that their sales target is quickly achieved.
so no one wants to limit a maximum amount because everyone wants their tokens to sell quickly

Maybe it could help regarding manipulation, but when projects send millions tokens to wallets, it will not worth the effort. Besides, you are going to pay $1, plus $1 fee?

Considering this, that is why I am not surprised that so many ICOs are not making much sales as used to be, because then, so many ICOs were considerate and wanted everyone who was interested to partake in them. That was part of the agenda of the inventor of cryptocurrency itself, which I feel should not be bridged.

You've made an interesting point. I think it would really be more reasonable. Perhaps the problem with the manipulation of coins by large investors would be solved.

I do quite agree with you on the maximum investment being better than minimum as this will to some extent ensure a relatively fair distribution of the coins/tokens. This will somehow water down the effect of dumping by a few. Maximum gives more people the opportunity to own shares in a project.

I think many ICOs don't want to deal with 1 bucks investors because they are usually not very clever and adequate. And also bigger number of participants makes KYC process more complicated.

Most of the ico has its minimum and maximum investment cap for getting a proper distribution. For example, in the last IEO, celer network max cap was $3k possibly and minimum cap was $20. So, I think it's a good way to being decentralised the coin distribution.

I don't understand the minimum amount thing too. I guess it is expensive to receive small investment from investors, if not, the whole thing doesn't make much sense. The set minimum  would not adequately decentralize the  coins if they are  concentrating them in few hands
I hope the idea behind it isn't to sideline regular/poor investors.

It depends on a project itself. If it is a very famous project that is about to launch its token sale, it is a great decision to make a personal cap, to allow more people to buy their coins and to avoid the creation of big whales.

A lot of discussions, but a significant reason for the minimum threshold is KYC verification, they cost anywhere from 2-20usd (yes i've seen 20usd KYC verification, especially if you go with a very small shitty service) per verification, depending on the source and how much automation is included.

Along with that, there are also costs for conducting TXs and a wide variety of overhead costs that rarely get disclosed. Also, the thought of 1000-10k people donating <$1 is a total nightmare for distribution and again, many of the costs associated with hosting the ICO itself.

These costs sometimes are just allocated directly from the pre-investments, sometimes they come directly out of the invested amounts. A lot of what you guys stated also plays factors as well.

One of the many things that's rarely spoken about (if ever) is ICO's disclosing allocation costs for running operations and how much working capital they have from the beginning. I'm not talking about the typical pie-chart, i'm talking real in-depth financials with forecasts, predictions and current running costs. Most competent ICO teams do have this information, and only disclose it to investors investing major sums of money into the project, but, again, rarely is public knowledge. This is a standard practice for real-world businesses and startups, but virtually unheard of in crypto. It's really up to the investor and crypto community to push for more transparency into these types of things and demand more from ICO/STO/IEO or w/e teams.

Yes I also had time to think about this. giving maximum value will be more helpful, but I think the Team will be better if it decides to give more data about investors who for example want to invest above that maximum value

The trend went into overdrive in 2018, when the price of Bitcoin  hit a peak of nearly $20,000 and Ethereum notched $1,200. ICO funding hit $6.3 billion in only the first three months of the year, as noted by Coindesk, but, fast forward six months and a new trend has emerged. Public ICOs, which allow anyone to invest, are increasingly replaced by a new approach of limited, private sales that consist only of accredited investors and close connections. Many ICOs today include no public sale component, with retail investors forced to wait until a token is listed on an exchange. This situation drove the impose the maximum number of investors allowed in participating in ICOs, that's why they impose soft cap capitalization, to compensate for the minimum number of investors on every ICOs, the most current on this trend are Poseidon, EtainPower and Bitrus.

Even though it was not like that, just because last year there were a lot of ico who experienced a scam that made investors reluctant to make investments in ico or buy coins at ico, and when investor confidence was running low, ico would have difficulty reaching softcaps, both small and large.