Initial Coin Offerings (ICO) Big risks with huge returns Chris Kitze, Chairman

What is an ICO? A way to finance a company or project via crowdsale of tokens Seed stage or even earlier!!! Donations are accepted (usually in BTC or ETH) to pay devs Investors receive tokens in proportion to their investment Tokens are traded on exchanges and used for projects

Why All the Attention? Almost $3B so far in 2017!!

Entrepreneurs Love ICO’s Much better terms than traditional venture capital A great way to build a community of users while raising capital

Spectacular ICO Returns ETH returned almost 1,000x (in 3 years)!!! MTL returned as much as 40x (in 3 months) a very long list of 2-10x returns in months

Mechanics of an ICO Build a marketing web site Write a white paper Collect BTC or ETH - promote your coin Deliver ICO tokens Trade on exchange Buy a Lambo!!

Economics of a Crypto Whale Investor Acquired ETH or other crypto early Owns BTC or ETH at very low cost basis Playing with House Money Can handle technical and key storage issues Some are crypto BILLIONAIRES

Coins That Never Did an ICO Bitcoin ($125B) Litecoin ($3B) Monero ($1B+) ...

A New Form of Credit Creation What’s Good About ICO’s A New Form of Credit Creation Coins go straight to the communities they serve Wisdom of the Crowd Usually a good indicator of demand Unregulated for Now A lot of innovation Immediate Liquidity Ability to exit once listed (~can be thinly traded)

Unqualified Teams are Funded Stupid Projects and Outright Scams What’s Bad About (some) ICO’s Too Much Money Raised Terminal value on Day 1 - Fat and Happy Team Unqualified Teams are Funded Some people are good at raising money, but can’t operate anything Stupid Projects and Outright Scams Some coins just shouldn’t exist Immediate Liquidity Many founders ill equiped to deal with a “public currency”

ETH raised only $17.3m (50,000 btc) A Tale of Two ICOs ETH raised only $17.3m (50,000 btc) ~ Distributed ~50m ETH (@ $0.35) Tezos raised $232m Founders fight over money with foundation + lawsuits No coin yet

Pitfalls of ICO Investing You have to know someone to get the best deal Scammers are everywhere You are responsible for storing the coins You are responsible for keeping up with news about the coin Too many ICOs, mountains of deal flow

Rules for Successful ICO Investing Always buy the TEAM! Token must build community and usage Not raising too much capital Get in early for biggest discounts Be prepared to trade when first listed If a coin continues to do well, buy more You will need to securely store keys

ICO Investment Strategy ICOs are “high risk” portion of crypto portfolio Sell a portion to immediately recapture invested capital - harvest gains into BTC Monitor status of project - know someone inside Communicate with lead devs Don’t get attached to any coins

Outsource Your ICO Investing to Professionals Alphabit Fund sees 20 new ICOs per day Investors in ICO’s since 2015 Experts in evaluating and investing in ICOs Professional accounting and key storage Excellent returns to date