ICO FOR NEWBIES: WHAT AND WHY
For those who have somehow missed thousands of news about new ICO’s a quick look at what it is and why it is encouraging people.
1)What is ICO?
Abbreviation of ICO is decrypted as Initial Coin Offering. During realization of ICO a project sells out tokens in exchange of cryptocurrencies or fiat money. In the future these tokens will be used as internal currency in a project or they could be trade on an exchange. The cost of tokens is volatile and their cost depends straight on demand and supplies on exchange.
2) For what ICO is needed?
ICO is simply a crowdsale. Used as the practice of funding Bockchain-based startups by selling digital tokens to the intended audience or anyone who believes in its cause. Usually ICO is held on the early stages of the projects, and all the investments are used for developing the project and bringing it to the production version.
Why ICO is so popularly among investors?
First of all, bought beforehand tokens(very often they are for sale on a discount) grow in a price on the market. Their cost can grow in 5,10,20,100 times. And it means that an investor can cash out the inlaid money in a project and multiply them in many times. It is possible to get services that is given by a company for a low price. Naturally there are risks for investors, when a project collects investments and does not gather to create this project, but high ROI expectations are still very attractive for investors.
Author: Alexandr Sushko
FLUX project CEO