Breakdown of Current Best Practices for ICOs

Autonomous Research has uncovered the best practices for token sales that are in place to help inform and protect buyers, and to increase the chances of successful token sales. Safety and information resources and measures for ICOs include (1) a white paper, (2) clear development map and (3) open sourced and published code. The white paper is designed to cover technical descriptions of the product and an explanation of how their ICO funding will work. Whereas the development map details the project stages, how funds are escrowed and provides transparent communication on the progress of the firm. The code is typically open-sourced as a form of contributing to the community and helping to accelerate learning, and as a result code that is private is viewed as potentially hiding ulterior motives.

Additional practices performed by ICOs include providing clear and fair pricing, although this varies depending on the pricing mechanism of the firm, with some opting for equal pricing for all and others giving early bird discounts. Developers of the firm also receive a share of the tokens and the ownership percentage is consistent with best-practices in other early stage investing. Lastly, one of the most imperative factors for good practices is a good faith marketing approach. Its aims should clearly outline the function of the network and the tokens, whilst not marketing the product as a high speculative investment. The most notable sites where this information can be gathered will be the home site of the firm, Consenys, Coinbase, Coin Center and USV.