ICO or ITO? What’s the difference?

Sep 19, 2017 · 2 min read

There has been so much talking about ICOs lately, and the word ICO has been thrown around a lot, even when it’s not quite the case. The term ICO was modeled on the acronym IPO, which stand for Initial Public Offering. In ICOs the offerings are in cryptocurrency, therefore the Initial Coin Offering definition.

The acronym ITO stands instead for Initial Token Offering. It is way more appropriate to talk about tokens for all those projects that use the Ethereum blockchain, and create assets that aren’t actually a new cryptocurrency, but rather a tool that allows different functions, like burning tokens or other kinds of revenue share.

In all these cases it is preferable to talk about tokens, as the term carries a broader meaning and it’s more versatile, and it better suits all the different situations and scenarios that are behind most of today’s so-called ICO.

This said, why are there so many projects that despite only selling tokens, present themselves as ICOs, instead of ITOs, as they should?

You could quickly answer that question by asking yourself, when was the last time I heard anything about ITOs? Probably never, while, as for ICOs, they are currently well known and advertised.

A more detailed answer would sure consider this difference between the acronyms ITO and ICO in terms of general awareness, which is a strong reason per se, but would also recognize a deeper reason, that is, that not many people truly know the difference between the two terms, and, most importantly, what the different ranges of application of each actually are.



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