ICO vs. IEO: Which is More Secure?
Being able to tell the difference between ICO and IEO is ideal in Crypto financing. Since ICO or Initial Coin Offerings are becoming less popular nowadays, IEOs, also known as Initial Coin Offerings, have come to dominate the crypto space.
The idea of an IEO launched in the year 2013 through a project that developed into MasterCoin or Omni. IEO is similar to an ICO and its launch became extremely prevalent in the crypto space. What makes the IEO different from an ICO matter on where the token or coin is advertised or offered. The IEO offers token through a partnering trade and not straight to the venture capitalists. Making exchanges centralized thus increasing the chances of losing money due to fraudulent actions such as hacking attacks.
Another significant contrast between them is that the ICO is open to the public which means anybody can take part. While in the IEO’s case, only a few individuals from a specific trade can purchase tokens or a coin which makes investing in an IEO easier than in an ICO. It prevents the investor from going through multiple procedures of individual ICOs. All it requires is to follow the process for securing and storing tokens from the trade or exchange. Somehow, the procedure is designed by the trade subsequently each trade sets the terms in purchasing.
In the IEO it takes a few phases, the first phase begins with an imminent financier that wants to fund a venture. Second, the said financier opens an account on the trade specifically for the venture after the KYC (Know Your Client) ID procedure. And if by chance those other financiers want to participate in the process, the coordinators or organizers can decide to choose which financier can partake in the process to promote the venture or undertaking. The financiers will be given a discount plus good exchange settings and pay the token using crypto-currency. Lastly, the token is then endorsed to their accounts.
But the big question is which procedure is more secure for venture capitalists? Utilizing a trade to direct an Initial Coin Offering gives off an impression of being more secure since it understands the chief concern of numerous ICOs neglect to solve which is the choice to effectively sell the tokens in the future. After the tokens are sold through ICOs, the venture capitalists are guaranteed that the tokens would be offered on a few trades. This matter is not constantly satisfied as certain tokens never make it to trades subsequently an Initial Coin Offering. This process is not the same with IEOs, where at the point as soon as the token is purchased in an ICO, the trade has just completed due thoroughness and is believed that the token will have a positive outcome. It additionally seems more secure in light of the fact that each trade will be considering its best importance thus unreliable tokens won’t bolster this concern.
In any case, everyone should be cautious of any trade to choose to purchase and in listing in the IEO due to certain exchanges being accused of taking money to list tokens. But thankfully, there are ways to protect oneself as a venture capitalist. There are anti-money laundering and KYC (Know Your Customer) checks to undertake if one decides to invest in a token. These kinds of processes will make it challenging for criminals that are posing as investors to participate.
IEOS are almost the same as ICOs however tokens in this kind of offerings are offered through a trade, dissimilar to the ICOs which are offered directly to the financiers. With regards to safety, the IEOs have all the earmarks of being more secure since the coins and tokens are promptly tradable after the IEO from the trade. IEO offers high transparency, high safety, and high liquidity than of the ICO.
Generally speaking, IEO is a secured and advantageous approach to obtain funds for ventures and an amazing venture prospect for some individuals and enterprises. In our current financial climate, it’s safe to say that IEOs are definitely more secured than ICO in various aspects.
At FIAT Exchange, we have consultants to help innovative start-ups, promising businesses and corporations launch their own Initial Exchange Offering, Initial Coin Offering, Security Token Offering or Reverse Token Offering effectively, efficiently and successfully. As a constituting body, we act as partners and assist each and every project from compliance, fundraising, and to final listing in our Digital Marketplace.
While there already are other operating equity crowdfunding platforms in the European Union, we are the first to expand to become a broker-dealer and introduce to our investors an alternative Smart Securities layer, offering a secondary market where investors can trade their startup securities.
If you are an Investor looking to unlock access in the FIAT Exchangeecosystem and discover new investment opportunities or if you are an Entrepreneur looking to raise capital, we can definitely help! Please feel free to contact us: firstname.lastname@example.org
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