If you’re reading this article, then chances are that you’ve probably heard of ICOs and know a little bit about Blockchain technology. Blockchain is a revolutionary technology with huge potential in almost every sector.
And ICOs are a great way for startups to take a step into the future and develop new innovative projects.
So, what is ICO? And Why should it be important to you?
Well, let’s find out. Here is everything you need to know about Initial Coin Offerings.
What is an ICO and What Do You Do With It?
IPO vs ICO
Let’s say that your company is starting a new project. You’ll need to do fundraising for it right?
Usually, companies will sell their shares in the stock market through something called an Initial Public Offering (IPO) or Stock Market Launch. Investors can buy these shares, and they get a portion of the ownership of the company.
Here, the company keeps the majority of the ownership, while giving a portion of it to other investors.
Initial Coin Offering (ICO), on the other hand, is the crypto version of crowdfunding where startups offer ICO tokens in a crowd sale. When a company wants to start a new project such as a decentralized application or cryptocurrency, they can conduct an ICO and offer their coins to the public.
Unlike an Initial Public Offering, buying an ICO token doesn’t give you any ownership of the company. The investors don’t actually invest in the company but rather in a project idea of the company.
So, how do investors make money off of an ICO? For More Details