Are you looking out for the biggest trends in cryptocurrency? Well, Initial Coin Offering (ICO) is going to be a fine start. Today, we’re going to give you an overview on the ICO.
Initial Coin Offering
The abbreviation of ICO is “Initial Coin Offering” and since 2013, ICOs are frequently used for evolving new cryptocurrencies. When we talk about ICOs, this also means individuals offering investors some units of crypto-token or new cryptocurrency in exchange, contrary to major cryptocurrencies such as; Bitcoin and Ethereum. If there’s a demand for pre-created tokens, then they can be easily traded and sold in all cryptocurrency exchanges.
ICO token could become the shares and securities of tomorrow and with the success of Ethereum, more and more ICOs are being used for funding the crypto project development. ICO has become a tool that doesn’t only reform the currency, but also the entire financial system.
History of ICOs
At the beginning of 2013, around 100 billion XRP tokens were created in the Ripple Labs, as the first cryptocurrency distributed by an ICO was Ripple. The main reason why the company sold these tokens was to fund the development of the Ripple platform.
A layer on top of Bitcoin was promised to be created by Mastercoin, for tokenizing Bitcoin transactions and executing smart contracts. Almost $1 million was received by the developer against the top-cryptocurrency Bitcoin.
ICO has funded numerous other cryptocurrencies like; Lisk, which sold around $5 million coins at the beginning of 2016. The Ethereum Foundation sold ETH against 0.0005 Bitcoin in the mid-2014 respectively. By doing so, around 20 million was received, and it became one of the largest crowdfunding, and now, it serves as the capital base for Ethereum development.
A simple token, which can be transacted on the on the blockchain of Ethereum is one of the simplest applications of Ethereum’s smart contract system and this type of contract was standardized with ERC#20. This is something that made Ethereum host of such an extensive scope of ICO that now you can say that Ethereum has finally found its Killer App.
The token is sold as a digital good, not as a financial asset and this is why it’s sometimes called “crowd-sale”. The legal state of ICO is undefined and in this case, the funding with an ICO is not regulated, making it quite simple and paperless.
ICO - Fundraising Future
The DAO is amongst the most prominent demonstration of Ethereum’s smart contracts. Ether, worth $100 million, fueled the distributed investment company. The idea of funding projects with a token on Ethereum turned out to be a highly successful generation of crowdfunding projects. You’d know that investing in token on top of Ethereum is very easy especially, if you’ve already tried it out. Just transfer ETH and paste the contract in your wallet. You’ll be able to see the token in your account and then you can easily transfer it as you want.
ICOs could be used for completely reconstructing the financial system of securities, shares, and decentralizing, not just money, but trade and stock creation as well.
Do you want to assess Ethereum’s market capitalization? Do not only look at the market cap of Ether but also on the token’s value.
Is it Profitable?
ICO has been a blessing for many investors but, on the other hand, many ICO ends with losses. Many scammers and semi-scammers have used ICO for; promising the greatest cryptocurrency ever or building a sleek website. In addition to that, the successful and largest ICOs, like Iconomi, Melonpost, Lisk, Melonpost, and Augur collected funds and delivered literally nothing.
Let’s find out what’s happening in the market for ICO.
Building a layer on top of Bitcoin was announced by Mastercoin in 2013, and Mastercoin-token were sold to investors. Around 10,000 Bitcoin was received by the developers and had the worth of $1 million at that time. Some investors made hefty profits and later, Mastercoin merged with Omni and Counterparty.
One of the largest ICOs has been made by Ethereum yet, with a pre-sale of almost 60 million ETH and around 31,500 Bitcoin were raised by the Ethereum Foundation. ETH-presale investors also profited immensely.
100 billion XRP-tokens were created in Ripple Labs and serve as an anti-spam mechanism in the Ripple payment network. Ripple Labs are selling XRP but their value doesn’t move in a clear direction. It started with almost 5,000 Satoshi, felt below 1,000 Satoshi, then raised above 7,000.
In 2013, a new gen-cryptocurrency made, Next. Around 1 billion tokens were sold to early investors and the developers only got a double digit’s amount of Bitcoins with the ICO. However, today the NXT token is valued much more and NXT has become a successful and firm cryptocurrency relatively.
Ethereum token ICO:
An Asian platform for decentralized Sportsbet completed the ICO of its token within few seconds and many of them have been purchased by a Chinese exchange.
The aim of Golem project is to create a decentralized supercomputer, through which applicants can earn money by selling its power. The ICO was limited to 820,000,000 tokens, and more than 10,000 BTC were received by the developers. Today, the Golem market share is beyond 50,000 BTC.
The decentralized prediction market uses REP-token to choose the outcome of events in which 80% of these tokens have been sold for funding the development and got around $5 million. Today all these tokens are worth more than $100 million.
Well, Iconomi is a platform for managing the virtual assets and the ICN token is like shares on the platform. 85,000,000 tokens were sold by the developers and more than 17,000 BTC were received for it. Today, it has a market cap of almost 40,000 BTC.
SingularDTV with the ICO raised more than 12,000 BTC and today, tokens as a whole are worth about 40,000 BTC.
The above ICO tokens can be easily purchased and traded on exchanges but some extra ICOs have just completed some time ago and are now preparing to release the newly created token on the Ethereum Blockchain.
This is the following projects:
Melonport’s aim is to advance a platform for managing the blockchain assets made on Ethereum. The MLN token that the developers sold were around more than 2,000 BTC.
Dfinity aims to build a decentralized platform for cloud computing and has raised more than 3,000 Bitcoin in its ICO.
The main aim of this project is to build a platform for the easy formation and blockchain based smart contracts and could raise more than 14,000 Bitcoin in an ICO for this mission.
You can currently invest in ICOs like:
- Humaniq (a wallet for the unbanked)
- Aeternity (“scalable smart contracts interfacing with real-world data”)
- Internet of Coins (a distributed environment for several blockchains)
- Cosmos (similar: “a network of distributed ledgers”)
ICO Blockchain Capital allows everybody to contribute to its investment rounds. But, not every ICO is worth your money.