There are risks associated with investing into token sales. However, there are also risks in investment funds, and in venture capital and angel investments. In fairness, the advice you would give to potential investors in token sales is not too different from the advice you would give to potential investors in any of the other more traditional vehicles:
· Do proper due diligence. Find out everything you can about the company, the team, the project details. Find what the SEC refers to as “fair and lawful investment opportunities”.
· Don’t be influenced by hype — whether this is excessive valuation of companies, sales push from fund managers and underwriters or crowdfunding targets.
· Invest in a risky class only as a portfolio diversifier and invest only what you can afford to lose.