Crypto fund raisers’ trending alternative - IEOs i/o ICOs

The cryptocurrency avenue is still in the growing phase of the industry, the better clarity on the regulatory framework of the underlying asset itself is the perplexing substance, they also presented risks to investors given their limited adoption, a number of massive cybersecurity breaches affecting cryptocurrency owners and exchanges, and the lack of consistent treatment of the assets by governments. Yes, we meant ICOs, a modern-day practice of fundraising method.

Due to the pitfalls of the method, many countries banned initial coin offerings (ICOs) in the past, where digital assets are sold publicly and then often traded on secondary exchanges, and when the price of underlying securities, like bitcoin plunged humongously, investors went clueless. Majority of such schemes are OTC based (Over-The-Counter) but not the exchange based. There was no concept of a clearinghouse or exchange or anything of that sort, as a result, increased credit or default risk associated with ICOs. Not all OTC markets are risky, it is only because of the clarity in the regulatory framework.

As time progressed, one of the most buzzing news has been IEO (Initial Exchange Offering).

The Fetch.AI project, that raised about $6 million within no time through an IEO scheme on Binance in the recent past. 

Prior to which, in yet another instance, BitTorrent tokens’ major shares were also sold for about $7.2M in just 18 minutes, through the same method of fundraising (initial exchange offering). 

Well, then let’s just quickly glance at what exactly is an IEO method, and how is it distinguished from ICO. 

It would be absurd to say that ICO markets are losing their importance or their traction, however, the scenario went noticeably adverse during late 2017 owing to the poor-quality and less trust-worthy projects, as a result, regulatory bodies across the globe have tightened-up the procedures or banned in some cases.

Alternatively, Fundraising facility under (IEO method) has to abide by the similar principles like an ICO, but the precise conditions being determined for each individual project. And the exchanges can be liberal in the fixing upper and lower limits just in case of either potential threats or the prosperity of the project on the flip side. 

One can participate in an IEO which is slightly varied from exchange to exchange, however, there is a resemblance in the procedure of due diligence of an ICO. 

Be wise to be noted that raising money through an ICO may not guarantee the prosperity of the project, whereas the exchange inspects a preliminary audit and ensures technical check-points of the project so as to enable tokens to flow in the right investment potential, only then token sale on the exchange would be set to take-off. 

The concept of the smart contract may not arise here, as was the case in an ICO project. Instead, investor, who is not willing to transfer money upfront, may actually schedule the exchange for buying such coins directly.

Currency Strength Index: FxWirePro's hourly BTC spot index has flashed at 152 (which is highly bullish), while hourly USD spot index has shown -65 (bearish) while articulating at 08:12 GMT. 

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