Introduction to ICOs - all you ever wanted to know
Get all you ever wanted to know about the famous ICOs, its calendar, how it works, and much more from experienced professionals!
Did you know that the Initial Coin Offerings are known to be one of the several by-products in the well-known cryptocurrency world? Today's businesses and startups are, more than ever, turning to alternative sources of capital which is opposite to traditional channels that include venture capitalists or banks.
The reason for that is that they can offer the actual value of their specific businesses by selling tokens, which represent units of the chosen cryptocurrency. It's the same as any other regular company would do with an IPO.
Of course, all investors are hoping to see the value of the token increase in the shortest term possible. Nonetheless, have you any idea what does the word "ICO" really stands for? Why did they gain so much popularity during a previous couple of years? Let's find out in the text below!
ICO and its calendar - get to know the basics
As you probably know, ICO is the acronym that stands for the Initial Coin Offering, a fundraising method that cryptocurrency startups use to offer services and products which are, most commonly, related to blockchain or cryptocurrency space.
The famous ICO calendar shows all of the active Initial Coin Offerings currently taking place in the cryptocurrency space. It may also indicate the ICOs that will happen in the near future. As you may know, Initial Coin Offerings are very similar to stocks. However, they have some utility for a software product or a service that has been offered.
It's interesting to note that some Initial Coin Offerings have yielded enormous returns for numerous investors out there. A great majority of others have proved to be frauds, have managed to fail, or performed very poorly.
How does Initial Coin Offering work?
It's essential to understand how an initial coin offering works to get a complete picture of it. In a situation where a cryptocurrency startup is looking to raise money through an Initial Coin Offering, it will generally create a well-known whitepaper with all the crucial information about the project itself.
This whitepaper will outline the subject of your project, the exact amount of money needed for the completion of the project, how long it will take for the ICO campaign to run for, what type of money will be accepted, etc.
All supporters of this project, during an ICO campaign, will buy some of the project's tokens with digital currency or fiat. These particular coins refer to buyers as tokens. They are incredibly similar to shares of a company that has been sold to investors during the Initial Public Offering.
The Bottom Line
In conclusion, raising funds via Initial Coin Offering provides a blockchain that is equivalent to a share. It's a cryptocurrency token. In many cases, investors pay for a popular token and receive a proportionate number of new tokens in exchange.
It's straightforward for a company to lunch an Initial coin offering to create tokens. In a matter of seconds, there are online services that allow the generation of crypto tokens. Investors have to remember this when considering the differences between tokens and shares.