ICO Analysis: Apollo18

While one can buy cryptocurrencies from exchanges, it is also possible to obtain them by an operation called mining. A miner basically solves complex mathematical puzzles and is rewarded by tokens in return for his or her efforts. Nowadays ASIC (application specific integrated circuits) miners almost exclusively are used to mine as they are way more efficient than their alternatives.

Yet buying and setting up your own mining device can turn out to be quite costly. These devices are usually expensive, you have to set them up in a cool environment to work efficiently and they use lots of electricity. For all these reasons, big facilities dedicated to mining are built in areas with cheap electricity all over the world.

But it is one thing that to work your devices with lesser cost and it is another thing to work them more efficiently. Once costs are equivalent, it comes down to efficiency. Apollo18 is a project that adopts best practices of global data centers to optimize mining silos and proportionally pay dividends to A18 token owners.

Located in Altoona, Pennsylvania where electricity is quite cheap, competitive with Canadian hydro-miners and their Chinese counterparts, Apollo18 is getting an electricity rate between 5 and 6 cents/KWh and will be able to get a local industrial rate of 1.7 cents/KWh once scaled.

Claiming the project to be “The Most Efficient Mining Operation in the GALAXY”, adopting global data centers’ ways should increase efficiency for sure. Yet this is not the ordinary worry with mining ICOs for ICO investors. Many such projects promise great returns on investment, using fancy words such as solar- or wind-powered, which is a huge red flag for any ICO. Once they collect the funds, these teams have no reason to continue their mining operations and pay dividends to their token owners.

Apollo18 acknowledges that the overall market volatility and fluctuations in mining difficulties make it almost impossible to have a fair guess at the future returns on investments and avoid any such talk. Also, the reader should note that the team seems to put importance on transparency and trust as on several occasions they have invited people to visit their facilities. Yet it is always of the utmost importance to be cautious when it comes to mining ICOs.

Just after the ICO is completed, the team is planning to begin issuing payouts to token owners on October 1st and to scale for the rest of the year of 2018.

Token

A18 tokens are sold in three stages. In the earliest stage, the private sale, almost 700,000 tokens are sold for $0.40, which is more than 50% cheaper than the ICO price. In the second stage, pre-sale, tokens are offered to investors for $0.65 and in the third stage, public sale, a price of $0.90 is set. Only around six percent of tokens to be sold were allocated for private sale contributors, and the tokens are locked for the next six months.

The initial total supply of A18 is 14.25 million tokens with the following token distribution:

  1. 1% token holders
  2. 9% marketing and growth

The team is planning to use the token sale proceeds as follows.

  1. 75% silos
  2. 15% facility
  3. 10% administrative

By allocating 75% of the obtained funds for hardware miners and so on, the project should be able to scale at a quite high rate. Prior to making any investment, you should consider that any unsold token will be burned as lesser supply usually indicates higher value per token.

Team

Marketing Director Nathan DeLong: DeLong was a creative director at SapientRazorfish, an NY-based marketing, and advertising company.

Advisors

Chris Mair: Mair is a founding partner and the key architect at DADI, a decentralized web services platform. He has worked as the head of digital at Diesel for more than four years.

Verdict

Below is a breakdown of the risks and growth potential of Apollo18.

Risks

  • Given the current state of the market, it might take some time to make a profit from any mining operation than one would initially expect. (-1)
  • Any ICO investor should be extremely cautious of mining ICOs as historically speaking they tend to be scam projects. (-1)

Growth Potential

  • Mining facilities are located in Altoona, Pennsylvania where the electricity rate is quite cheap. This means that the cost will be lower, and the dividends will be slightly higher. (+3)
  • The team’s putting emphasis on efficient mining by following global data centers’ footsteps shows how serious they are. (+1.5)
  • By using 75% of token sale proceeds, the team is planning to scale up by buying more hardware miners. Once they achieve a critical point of scaling, they will be able to get a much lower rate for electricity, implying lower costs and higher payout for token owners. (+2)

Disposition

The introduction of ASIC miners has changed the cryptocurrency market a lot as it has pushed people without these devices outside of the mining game. Even if one can afford to buy an ASIC device, this does not mean that he or she should expect solid returns on investments as it highly depends on the electricity rate for these devices use huge amounts of electricity. For people living in areas where the electricity rate is high, it is extremely hard or perhaps impossible to make a profit. Because of all of these issues, a need for mining ICOs has arisen. By participating in such ICOs, one basically lends his or her money to someone else, so the project owner can use these funds to buy miners and run facilities. Apollo18 is such a project based in Central Pennsylvania where the electric rate is quite cheap. Once the operation commences, they will pay their token owners dividends proportional to the amount of tokens they hold every month. Upon scaling, they should be able to get electricity at a lower rate, implying lower costs and higher payouts. Apollo18 receives a 4.5/10.

Investment Details

  • Type: ERC20 – Presumably Security
  • Symbol: A18
  • Platform: Ethereum
  • Crowdsale: September 17th
  • Minimum Investment: Unspecified
  • Price: $0.90
  • Hard Cap: $8,475,500
  • Payments Accepted: ETH, BTC and USD
  • Restricted from Participating: The United States and China

For More Information

Featured image courtesy of Shutterstock.

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