ICO has proven to be a revolutionary way to raise money for many companies and projects. ICO can be described as a combination of traditional and advanced methods. First of all, it should be borne in mind that investors investing in ICOs will be 100% risk free due to the technology used.
Until now, most of the ICO funds have been collected through Bitcoin (BTC) or Ether (ETH). When conducting an ICO, the project creates a Bitcoin or Ethereum address to receive funds, and then displays it on the corresponding web page. The procedure is the same as opening a bank account and then showing it on a specific web page to people so they can send money.
An Initial Coin Offering (ICO) is essentially an illegal way of collecting crowdfunding using various cryptocurrencies (in some cases, fiat currencies), which is used by cryptocurrency organizations to obtain the capital funds needed to complete a project. As part of the ICO, a certain part of the recently released cryptocurrency is sold to investors in exchange for any legalized means of payment or any other cryptocurrency. This can be called a token sale or a crowd sale, which involves receiving an investment amount from investors and giving them some of the functions associated with launching a project.
An IPO, that is, an initial public offering, is a process in some way associated with an ICO in which investors receive shares owned by a company. While in the ICO, investors buy the company’s coins, which can increase in value if the business expands.
The first token sale, i.e. ICO, was carried out by Mastercoin in July 2013. Ethereum raised money through ICOs in 2014. In recent years, ICO has taken on a completely new definition. In May 2017 it was approx. The 20 offers, plus the recent ICO of the Brave web browser, generated about $ 35 million in just 30 seconds. Until the end of August 2017, there have been 89 ICO coin sales totaling $ 1.1 billion since January 2017.
Investors send bitcoin, Ethereum or any other cryptocurrency to the specified address, and then receive new tokens in return, which could be of great benefit to them if the project is hit.
- ICOs are mainly held for cryptocurrency-based projects that rely on decentralized technology. Therefore, naturally, such projects will attract only those investors who show great interest in the concept of cryptocurrency and are friendly with the technologies used.
- The document owned by the investor does indeed remain in the form of a web page, white paper, or web publication. Some of these documents contain accurate information about the project, even if some others literally falsify its specifications in order to mislead stakeholders. Therefore, it is best to go through a quality check before relying on any kind of technical document or electronic document.