What is the first public listing of cryptocurrencies (IEO)?
An initial exchange offering (IEO) is a token sale that is supervised by a cryptocurrency exchange. IEO is only available to users of the exchange, although some IEOs may take place through some other form of exchange. Just like ICOs , IEOs allow investors to acquire new cryptocurrencies (or tokens) in raising funds for promising crypto projects.
What is the initial exchange preference (IEO)?
Many people in the cryptocurrency space call the original Exchange Offer the next step in the evolution of ICOs. Since its inception, ICOs have been unregulated, and most of the cryptocurrencies have been involved in non-transparency. The IEO is the way intermediaries deal with issues on both sides of investors and broadcasters.
There have been more than 50 crypto projects with IEOs in 2019, an increase of more than $ 159 million, in ICObench compared to 2018.
The IEO tries to promote legitimate projects only because it is under the credibility and guarantee of cryptocurrency exchanges. Therefore, the inspection process is more rigorous before it is conducted in IEO. Besides, not all project ideas can be supported by exchanges, because of some criteria of exchanges.
Essentially, IEO is another way to raise funds for cryptocurrency startups through cryptocurrency exchanges and exchanges that act as intermediaries between buyers and sellers. With the help of cryptocurrency exchanges, cryptocurrency projects gain significantly more exposure, interest and credibility.
After the IEO is successful, Token issuers pay a listing fee along with the number of tokens agreed to hire the exchanges as an IEO organizational unit. Shortly thereafter, digital currencies are listed on the exchange where investors and members of the exchange can access liquidity immediately.
Features of Initial Exchange Offer (IEO)
Like the ICO, the Initial Exchange Offer has a certain amount of money issued and for a fixed price, there are minimum and maximum token limits available for public release.
However, unlike the ICO token, the IEO money was minted before Crowdsale. Besides, the issuers and exchanges exchanged a few days or weeks before the IEO, which made it more convenient for investors (immediate liquidity). In addition, the IEO process naturally involves a trusted broker (IEO Exchange) that handles transaction funds. That helps to increase investor confidence in the project, which most ICO projects do not have.
Pros and cons of IEO
Basically, IEO is an advantage due to:
- Increasing investor confidence. Investors who do not deal directly with the IEO project creation team, and work with an exchange representative to make purchases, will become more reliable and safer in a future project. .
- Security for both token issuers and investors. The token issuers also met their expectations because IEO exchanges manage everything related to regulations, such as the mandatory KYC / AML inspection process for everyone involved. .
- Friction process. IEO platforms ensure that most people, regardless of their experience in the cryptocurrency space, can easily contribute and exchange ideas.
- Guaranteed listing exchange. The IEO token is listed on the IEO exchange shortly after the IEO project is underway.
- Eliminate scams. IEO project teams are neither anonymous nor fake, so they won’t disappear after collecting your money.
- Benefits for projects , such as increased marketing efforts by exchanges, greater credibility, exposure and greater interest in the project and investors.
- Benefits for exchanges , helping to increase new users through the process of having to register information to be able to conduct trading and trading IEO tokens.
However, the IEO also has the following risks and concerns:
- Regulations and restrictions are not clear. Many countries have enacted restrictions or completely banned ICOs, which may also reflect badly on IEO.
- All investors must comply with AML / KYC. The cryptocurrency community is known to be a place filled with individuals obsessed with privacy, so the implementation of AML / KYC procedures may be an uneasy thing for some people.
- Market manipulation and coin focus. Most IEO tokens are pre-issued, so you should always check the token distribution ability before investing. Crypto-issuing groups and exchange IEOs may hold ridiculous large amounts of tokens for themselves, which could lead to further price manipulation. Besides, it is no secret that the vast majority of exchanges participate in money laundering transactions.
- A limited number of investors. There have been many complaints from investors that not everyone can buy tokens in IEOs.
- There is a concern about bots that can be programmed to participate in IEO and the risk of beating human investors in trading.
- Remember to research and carefully examine the projects and ideas you want to participate in. Including those who release the IEO project and the IEO exchange, they will intentionally create certain hype to be able to sell all the coins. Be sure to carefully check the whitepaper of the project, the idea of applying digital currencies. For more potential red IEOs, see our guide to ICO risks in 2019.
BitTorrent IEO launches through Binance.
The first large-scale IEO, the infamous BitTorrent , was launched by TRON via Binance Launchpad in January 2019. Nearly 60 billion BTT tokens were sold out in minutes and raised about $ 7.2 million.
After observing the success of Binance IEO, more notable exchanges began copying the model. Another notable IEO was launched through Bittrex International . Veriblock (VBK) has raised $ 7 million in under 10.4 seconds . This record was then surpassed by an IEO Blockcloud made through OKEx Jumpstart, which sold out $ 2.5 million worth of BLOC tokens in a second .
Exchange of IEO support
Since May 2019, the exchanges have launched their own IEO platform:
Exchange IEO Platform Binance Binance Launchpad OKEx OK Jumpstart Bittrex Bittrex International IEO Huobi Huobi Prime BitMax BitMax Launchpad KuCoin KuCoin Spotlight Gate.io Gate.io Startup Bitfinex & Ehtfinex Tokinex IDAX IDAX Launchpad Probit Probit Launchpad Coineal Coineal Launchpad Coinbene Coinbene MoonBase Bgogo Bgogo Apollo LATOKEN LATOKEN Launchpad ExMarkets ExMarkets Launchpad BitForex BitForex Launchpad COBINHOOD COBINHOOD Coin Offering Platform Liquid Liquid ICO Market ABCC ABCC Launchpad Bibox Bibox Orbit BISS BISS Launchpad ZBG ZBG Launchpad BW BW Launchpad Bithumb Bithumb Launchpad BitMart BitMart Launchpad Bitker Bitker Launchpad CoinTiger CoinTiger IEO HOTBIT HOTBIT Launchpad LBank LBank Launchpad DRIVE Markets DRIVE Markets Bitmeta Bitmeta Coinis Coinis Follow the latest IEO news and updates with Cryptonews.com .
How to participate in IEO?
A typical IEO process looks like this:
- Find an IEO project you want to invest.
- You need to register and verify your account by completing the KYC / AML procedure.
- Check the cryptocurrencies that you can use to join your IEO and wallet to deposit them into your account.
- Wait for the IEO to start and buy the Token.
Of course, the process may not be as simple as described here, because every IEO platform has methods that ensure a fair process for all users. For example, Binance Launchpad introduced a lottery-based token distribution method for Matic Network IEO.
Remember that every IEO project tends to sell out pretty quickly, so be quick and ready before it finishes!
