An Initial Coin Offering is commonly known as ICO, it is one of the hot picks and mostly talked topic of these days. It is a new form of fundraising process of today’s time. The multiple new and running project introduce their crypto tokens in exchanges to raise funds for bitcoin, ethereum, and other top cryptocurrencies.
ICO is more or less similar to an Initial Public Offering ( IPO ) investors purchase the part of equity sold by the companies. This is a common practice done to collect the funds without reaching out to banks and venture companies (VC).
Ripple is the first ICO token. In 2013 Ripple Labs created 100 billion XRP tokens and sold them to raise the fund for the development of Ripple platform. Several other virtual currencies founded and launched as ICO for crowdfunding. Ethereum is also one of those ICO that has raised over $18 million in 2014, the price for a single ETH token was 0.0005 BTC per ETH this made the ethereum the largest fund raised ICO of that time.
There are two kinds of an Initial Coin Offering
Crypto tokens are based on the new project for which a new cryptocurrency is created. The token sale in which everyone can participate. The fund raised through the token is used for the execution of the idea and after the successful sale of a token, the price of your token invested rises to give you profit.
The crypto coins are created differently from the BTC. They have their unique features and blockchain.
ICO has become a tool for many startups to live their ideas and innovations. The speedy awareness of such ICOs can revolutionize the financial system and can become a part of the security of your own funds as we go close to the idea of the digital world.