Before we talk about investing in SNS, let’s ask the question what is SNS? The Social Nervous System (SNS) stands as a remarkable facet of the Internet Computer, offering founders a unique avenue to transform their applications into DAOs—a capability not found in traditional blockchains. In essence, founders construct their applications, submit the code for scrutiny through a proposal, and the NNS (Network Nervous System) votes on its launch viability via the SNS. If the team’s integrity, code accuracy, and overall readiness align, and the vote passes, the subsequent phase involves the SNS decentralized sale. During this sale, individuals can utilize ICP to contribute to the DAO, obtaining governance tokens in return.

The ICP becomes securely housed within the DAO treasury. Once the sale concludes, the DAO assumes control of the now decentralized application. DAO members wield the power to propose code changes through governance, with automatic code execution ensuring a decentralized process. This marks a significant stride in the evolution of DAOs.

Nevertheless, as with any venture, risks exist. Let’s delve into prudent practices and essential considerations for those venturing into SNS investments.

1. The Founders

Undoubtedly, the founders play a pivotal role, even within the context of a decentralized application governed by a DAO. Ensuring trustworthiness in the founders is paramount, given the collaborative nature that persists throughout your investment in the DAO. Although the SNS architecture safeguards against the founders absconding with treasury funds, they retain a portion of the DAO governance tokens, affording them influence over development decisions. It is imperative to ascertain their commitment to ongoing contributions to the DAO beyond the sale’s conclusion. Without this assurance, you risk aligning with a leaderless DAO lacking direction, potentially facing former founders incessantly offloading tokens while pledging development. Emphasizing this aspect cannot be overstated.

2. Team History

Expanding on the initial point, delve into the team’s track record. Investigate their involvement in prior projects, evaluating whether they have consistently fulfilled their commitments or if there were instances of questionable practices. While this research may require a significant time investment, its significance cannot be overstated. If the team possesses a tainted history marked by unfulfilled promises or questionable conduct in previous projects, exercising caution and refraining from investing in SNS your hard-earned money in the current project becomes imperative.

3. Ask Questions

Leverage Twitter as a powerful communication tool to inquire about an imminent SNS sale. Actively engage with the team and express your thoughts without hesitation. When contemplating an investment in a particular project, don’t shy away from publicly reaching out to the team with specific questions. If you detect any reluctance or hesitation in their responses, consider delving deeper in that direction for a more comprehensive understanding. Open communication is key, and Twitter provides a valuable platform for transparent and direct interaction with the project team.

4. The Concept of the DAO

A crucial aspect to consider is undeniably the application itself. Merely launching a dApp through the SNS doesn’t guarantee automatic success; the key lies in a compelling idea with differentiating features that set it apart from competitors. Assess its potential for a robust network effect. Additionally, scrutinize whether the application is better suited to operate under a DAO or if a more centralized model would be more fitting. It’s essential to recognize that centralized applications running on a decentralized network are not inherently negative. Certain business models may be incongruent with the DAO model, and acknowledging this flexibility is paramount in the evaluation process.

5. Comparison to Established Projects

Often, the most effective method to gauge the potential of an investment is to compare it with already successful and established projects. Take, for instance, OpenChat—a project that has dedicated over two years to the relentless development of its chat messaging application. Actively pursuing partnerships, engaging with the community, and incorporating constructive feedback, OpenChat exemplifies a commitment to excellence. Their marketing strategy, including the innovative approach of sharing 50% of Premium subscriptions from newly referred members, stands out as noteworthy. It’s crucial to note that OpenChat’s team has been consistently practicing these principles well before their SNS sale, underscoring a sustained commitment to best practices.

6. Trust Your Gut Feeling

In many instances, exercising caution is a wise decision. If a situation raises any doubts or feels unsettling, it’s prudent to maintain distance. Why? Trusting your instincts is crucial; avoiding a potential loss that aligns with your initial gut feeling can mitigate the psychological impact compared to investing in SNS and facing a potential loss. Remember, the crypto space is dynamic, continually presenting new opportunities. It’s essential not to force your luck, acknowledging that more opportunities will undoubtedly unfold in the ever-evolving realm of crypto.

In conclusion, navigating the realm of Social Nervous System (SNS) investments requires a meticulous approach. By scrutinizing key aspects such as the project team’s history, the integrity of founders, and the alignment of the application with decentralized models, investors can make informed decisions. Communication plays a pivotal role, and leveraging platforms like Twitter to engage with teams and seek clarifications can offer valuable insights.

Drawing parallels with successful projects, like OpenChat, and recognizing their commitment to sustained best practices before a sale can serve as a benchmark for evaluating prospective opportunities. Additionally, embracing a cautious mindset and trusting one’s instincts in the face of uncertainties ensures a balanced and informed investment strategy.

As the crypto landscape evolves, opportunities abound. It’s crucial not to force investments and to remain adaptable, recognizing that the crypto space will continually present new and promising avenues. By staying informed, exercising due diligence, and maintaining a strategic approach, investors can navigate the dynamic world of SNS with confidence and prudence.