What is an ICO or TGE?
If you’re new to the cryptocurrency space, you’ve probably seen the acronym ICO on a variety of cryptocurrency news outlets and cryptocurrency forums. If you’re just getting started, these concepts can be extremely confusing and can take a little bit of time and patience to understand.
All of these terms focus on a new method of crowdfunding, used since late 2015 & exclusively found in the cryptocurrency space. These crowdfunding methods replace more traditional funding methods such as venture capital funding, seed rounds etc. The popularity for these methods of funding come from the energy circulating the blockchain space as well as the simplicity of starting a project such as this. Although there are a variety of specific features attached to each specific crowdfunding method (ICO, TGE), the basic premise of these methods focus on using a custom made token or coin to facilitate an initial cash injection into a business in order to facilitate a start-up venture or to expedite business growth.
“ICO’s are also democratizing early-stage investing, allowing a wider pool of investors to participate. Token offerings shift power and control to the blockchain rather than one or two influential investors. — Jeff Tennery CEO and co-founder, Moonlighting
Jeff highlights a quantum shift seen in ICOs, emulating the entire cryptographic movement. There is a sentiment to disrupt and revamp the existing system into one that favors the masses and removes the privileged, centralized authority from any position of power or leverage. The ICO/TGE space is an exciting new entity, with many companies choosing to fundraise through an ICO or TGE; however, let’s take a deeper dive into the mechanics of how these things really work.
An initial coin offering or ICO has received much attention over the past few years (both positive and negative). An ICO mimics the term “IPO” and serves many similar functions, without the need for equity dilution or shareholders. Although regulatory concerns have certainly become more prevalent (there are discussions as to the legal status of the coins issued), these events are still extremely popular.
The purpose of the ICO serves as a funding mechanism for early startup ventures. In order to fundraise for their projects, companies opt to sell coins or tokens as opposed to having to present their business ideas to a plethora of venture capitalists. Although the facilitation of an ICO does not mean that traditional venture capitalists are barred from participating, it is common to see vast amounts of micro-investments ranging from a few hundred to a few thousand dollars. This is a far cry from the hundreds of thousands to million-dollar investments committed by venture capitalists in the traditional startup space.
Token sales are a precursor for a token generation event or TGE. These events usually consist of a token created and distributed to a group of early adopters. The specific features of the token vary between projects; however, in most cases the tokens represent a utility. This utility is either already built or will be built in the near future by the company issuing the tokens. The Elysian team will be issuing the Elycoin, a token which will be an integral part of our MVP, the Elysian Ecommerce platform. The Elycoin will be the preferred currency in our Ecommerce platform, allowing millions of people to transact in an intelligent, user friendly application. The ability to use our Elycoin for transactions will provide instantaneous, low cost payment processing. Not only will this allow a more convenient payment method on our proprietary system, yet will allow for a complete Elysian ecosystem improving the end users online shopping experience from sign in, to check out. If you would like to participate in the Elysian TGE, go to https://elycoin.io/ for more details.
