Will you earn more money investing in ICOs or by day trading cryptocurrencies?

Crypto markets offer us two ways of earning money. Investors can either become traders, a job which usually requires daily staring at charts, studying patterns, predicting market movements and buying and selling cryptocurrencies in a manner which ensures you make profit (or minimize your loss). Or they can become ICO buyers, people who are looking to pounce on new coins before they even become listed on the market and HODL them for a longer period of time.

ICO’s or initial coin offerings refer to coin launching events organized by various crypto related projects where investors get a chance to buy said projects tokens early, usually with a very good discount. Investing in an ICO is a process that usually requires a specific set of skills. You’ll need to have a keen eye for spotting a gem of a project, one that will have a lot of potential to grow in the future.  You will also need to know how to purchase your tokens and where to store them. Trading will also require a similar set of skills as you’ll need to know how to spot a coin that is about to break out, then buy it and store it, before selling it at the top of its run.

When compared to each other, these two crypto money making activities do have their own advantages, as well as negatives. So let’s look at some main issues where they collide and determine which one is a better choice for a beginner.


Looking strictly at how safe it is to invest, ICO’s can potentially be a better option. Even though a lot of ICO projects will fail or turn out to be scams (some sources claim that 80% ICO’s won’t live to see exchange listing), the signs that this might happen are relatively easy to pick up on. Check out this article we published previously that touches upon how to recognize a bad ICO. Learning the basics about bad ICO’s can help you weed out the trash and gain access to that golden 20% that will become real projects with potential. Granted, out of those 20%, only ¼ will become successful, so you are still taking a risk, but your risk is based on an educated guess.

Trading can also be seen as a form of educated guessing (if not straight up gambling). Traders are trained to look at the coin charts and spot various patterns that have historically led the market into certain outcomes. Based on these patterns, the trader will bet on a certain outcome happening by buying/selling or longing/shorting a coin he watches. This practice can be safe if you know what you are doing; however there is a very real chance that your educated guess will backfire even if you are the most experienced chart watcher in the world. Which is why risk management and a lack of emotional engagement with the project is what a trader must focus on if he wants his funds to stay safe.

Cold storage for bitcoins are separate topic – you can read more about it in the linked article.

In truth, both practices can be risky and can be affected by speculation, but ICO’s edge this one out as they offer greater potential with a somewhat lower risk level. Quality ICO projects also offer tokens whose valuation is relatively unaffected by speculation, so investors can look forward to safer future gains as the roadmap milestones start getting reached.


This one really depends on what you invest in and how well you invest in. Day traders can on any regular day out-earn an ICO investor, but ICO’s have been known for their spikes in valuation. We have seen numerous coins that have went over 1000% percent in a very short period of time, which are gains that a trader will have to work for a lot longer. Unless he lucks out and invests in an ICO coin that is about to explode.

Even so, a trader usually takes his position with pre-planned tactics, with set sell-off points and stop losses, so he might miss out on the full run of a token as his sell-offs hit along the way. ICO’s also provide roadmaps that can give you an insight when and how much the token will rise. For example, a mainnet launch during a bull run can net the investor some serious gains. So while trading can provide gains more consistently,  ICO’s do offer potentially higher gains if you get in on an absolute gem of a project.

Involvement in a new project

Usually these early projects aren’t available on the market. Therefore, a trader will have the disadvantage of not being able to get in early into a promising project. By the time it hits the exchanges, the project’s value can multiply numerous times and a trader might get in on the tail end of its run. Meanwhile, ICO investor who bought in at the bottom of the run will get to profit from the entire bull run of this token.

ICO investors also become a part of the closer community surrounding the project, getting to know the team and the people involved better. This can provide inside information that can help an ICO investor decide what the future of a token will be. However this can also sometimes deter the investor, as he can become too emotionally invested into a coin and decide to ignore clear red flags that suggest he should sell.

Final thoughts

Overall, the advantages and risks do exist with both styles of investing. A capable trader will be able to multiply his gains in a very short period of time, similarly to a capable ICO investor. They will both need to worry about speculation, regulation, volatility, project legitimacy, vision and valuation. Legitimacy of the project can sometimes not be an issue for a trader, as bad coins do experience price hikes; there is nothing wrong with catching that train and riding it to Gainsville. You just have to be careful to not fall asleep along the way, as you may miss your exit and end up in Rekttown.

While both require that you do your diligence, ICO’s are somewhat easier to invest in. ICO investor only needs to look at the fundamentals of the project to determine if he wants to invest into a project. Trader on the other hand needs to stare at charts and look for patterns while keeping an eye on the news about the project. This leaves ICO’s slightly ahead in terms of simplicity of investing and beginner friendliness. One should perhaps look to try out both methods in a minimized capacity before deciding which one suits him best.

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Dobrica Blagojevic
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