What Are The Factors To Consider Before Investing In STO?

We have already talked about what exactly is STO. We have also explained how to choose the STO that you would like to invest in. However, there are some things that you need to think about before investing in any Security Token Offering.

Evaluate The Risk

Like any investment, investing in an STO has the risk. Strict regulations protect you from being scammed. Working MVPs (minimum viable products) show you the dedication and quality of the team’s work. Whitepaper introduces to the company’s ideas, look into the industry, problems they want to solve, and the plan they have for the future. However, nothing can guarantee the success of the project or their STO. You have to get to know the project, evaluate the company, understand the problem their product will be solving and believe in their success.

STO Does Not Offer An Immediate Profit

Like any other investment in a growing company, it is a plan to benefit in the long term. The crowdfunding is financing the project that, once it’s finished, will earn money for creators, and they will share the profit with the investors as settled in the investment agreement.

The benefits can be paid at a different frequency — quarterly, biannually, annually. Also, you have to check what exactly you can expect to receive in the future. For example, ROKKEX STO expected returns are up to 15{6feaf74659bb228ac71d4b44630a8d52e718e4127a7f4337598235e19f63e205} gross profit, 5{6feaf74659bb228ac71d4b44630a8d52e718e4127a7f4337598235e19f63e205} fixed interest, and a possible 5{6feaf74659bb228ac71d4b44630a8d52e718e4127a7f4337598235e19f63e205} commission from the affiliated investments. All these numbers can get confusing, so some projects have the profit calculators that will help you stay on track.

STO ≠ ICO, and Utility Token ≠ Security Token

Many people are still comparing STOs to ICOs and mixing them up or talking as they were conjoined twins that live, eat, and fall together. ICO and STO come from the same crowdfunding idea in the shape of a token offering, but they are significantly different.

STOs are subjected to strict rules and regulations that apply to everything — investor selection, investment processing, data handling, returns, earnings, procedures to be taken in case of failure. In comparison, ICOs are more often set to collect as much money as possible and do not really care where the investments come from.

Utility tokens allow you to benefit from using the product(s) and building the internal economy system of the ecosystem. While Security Tokens let you profit from the project, they are more like an investment contract. All of this makes ICOs and utility tokens more prone to scams, which was the reason for rising distrust in crowdfunding.

If you want to know more, you could check these articles:

KYC and AML Procedures

Due to the already mentioned rules and regulations, the investment can seem to be more complicated and prolonged. Also, the rules might apply some geo-restrictions, and KYC requires you to confirm your identity. However, KYC and AML procedures are mandatory for all STOs. They confirm the transparency of the project, reassure that funds are real and clean, protect both investors and the company from scams and any repercussions caused by carelessness. At the same time, following regulations, can open the investment to some regions that have strict control and do not allow baleful crowdfunding projects such as ICOs.

If you already thought about everything, picked and evaluated the project and grabbed your ID for the KYC, we wish you good luck and profit.

We would also like to invite you to check out our project and perhaps invest in ROKKEX STO.

At ROKKEX, we take security extremely seriously, and our crypto exchange is built on ‘Security First’ principle. We want to share our expertise with the broader public for the world to become happy, safe, and wise.

If you have any ideas and suggestions, contact us at

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