Your 7 Steps to ICO.
- Define the jurisdiction for your incorporation (however, ICO may be conducted without that, as in a case of DAO);
Here's a link to a table containing info on legality of Bitcoin by country or territory (bitcoin is a virtual currency or a token, therefore all other tokens are treated similarly to bitcoin): Legality of bitcoin by country or territory
- Develop Token Model (Economy) which wouldn't meet the requirements of Howey Test (The US Supreme Court case of SEC v Howey established the test for whether an arrangement involves a security):
1. An investment of money; 2. in a common enterprise; 3. with an expectation of profits predominantly from the efforts of others.
Here's the link to a legal paper explaining this issue in great details: https://www.coinbase.com/legal/securities-law-framework.pdf
II. Develop Token Economy.
Your Token must have a real utility as a mean of payment.
III. Prepare the White Paper.
It's like a business plan.
VI. Develop and Test the Smart Contract.
This contract is written on an object-oriented programming language (Solidity, developed by Vitalik Buterin) and it allows e-wallets to handle tokens across multiple interfaces.
Here's a guide line on how to write this Contract: https://github.com/ethereum/EIPs/issues/20
V. Mitigate Risks.
1. To avoid errors in software: Use standard modules for smart contract development (for example OpenZeppelin https://openzeppelin.org/).
2. To not allow any individual, founder, investor, or developer on a project having a full control of funds: we should hold funds in multi-signature wallets and employ escrow partners to hold the keys to the wallet.
More on this topic see here: https://cryptoconsortium.github.io/CCSS/Details/
VI. Raise Capital Structure.
There are multiple questions we have to address, including:
- What is the ratio between the supply of token offered to market at sale time and the supply preallocated to you?
- How do we create a token distribution that is most advantageous for you?
Here's a link to the article discussing this question in details: https://blog.coinfund.io/toward-more-equitable-token-sale-structures-a71db12c8aff
- Community building; - Early adopters; - Full project details, founders and team disclosure (site, forums); - Establish the line of communication with tokens potential buyers (on Twitter and Telegram); - Articles, founders interviews, YouTube videos etc.