IEO – Initial Exchange Offering
Is Initial Exchange Offering completely different from Initial Coin Offering? No. So, is it the same old wine in a new bottle? Not exactly; but kind of the same with high securities and additional benefits for both the investors and the project teams. Well, this blog essentially aims at throwing light on what is an IEO is, how it benefits the investors and the project teams and in which means it is different from an ICO.
Before we step on to what IEO – Initial Exchange Offering is, we need to have exact knowledge about ICO. It is the Initial Coin Offering open to the public where anyone can buy the project teams’ tokens for any desired amount. It does not require an exchange to mediate the process. Since the project is open to the public, the project teams can generate more amount than the one compared to IEO. Scams and fraudulent activities to follow.
Let us move on to what an IEO is. Firstly it is more like the ICO fundraising thing but with a restriction that you have to be a user of the exchange that hosts the IEO. Yes, unlike ICO that is open to anyone, the IEO is restricted to the users of the exchange only. This way fraudulent activities can be prevented, and the investors get an assurance on the project teams’ credibility.
Here are some of the most popular advantages of an IEO.
- In an IEO there is more authenticity than an ICO. Since it is hosted on an exchange platform, both the investors and the developers will be checked for their authenticity.
- The investors stand a lower chance of losing their funds because the whole process undergoes strict verifications.
- The security is tightened by the exchange platform doing extensive research on the project developers and their backgrounds.
- Listing the project token on the exchange platforms will be much easier when the ICO takes place on the exchange platform. I.e. it exchange listing is easier on IEO than ICO.
Here are the specific benefits for the exchange platforms.
- The Initial Exchange platforms get to charge the project developers and the team for the listing services they give. This is a way to generate extra income.
- The exchanges also have the benefit of increasing their user base. That is anyone who wants to buy the coins but does not have an account should get one before buying.
- When the regular crypto-exchange teams join hands with the IEOs, they gain more expertise in the field and at the same time the IEOs benefit from them.
There is a lot more to IEO and ICO. Keep watching this space for updates.