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What makes IDO launchpad different from ICO and IEO?

As we prepare for the launch of the HeadStarter IDO platform, now is the right time to help the community understand what an IDO offers and what the differences are between ICOs and IEOs.

ICO — Initial Coin Offering

An ICO is an effective way for a project to raise capital in preparation for their token launch. This is usually done through a project’s own website, which means they are responsible for the security of the ICO, the process of transferring the promised tokens to the purchaser’s wallet and the marketing and advertising efforts.

Being responsible for the release of a token/coin, means they can publish as little or as much information as they want about themselves and the team members, and can decide on a favourable regulatory jurisdiction or not even incorporate one.

IEO — Initial Exchange Offering

An IEO is a great way to reach a broader market, as exchanges are used by most crypto investors, even if just as a first step to getting crypto into a self-custodial wallet. This means that the marketing and advertising efforts can be targeted towards a large number of people, all of which are interested in crypto. The exchange also ensures immediate liquidity is available on newly created markets for the newly launched token.

These positives do come with a few sacrifices though. Although CEXs offer some level of transaction security on their platform, the centralized nature of a CEX represents a single point of failure. Furthermore, users are not custodians of their tokens/coins and are subject to higher fees set by the exchange. The project launching is also charged a commission and listing fee.

IDO — Initial DEX/Decentralized Offering

An IDO is great for both the project and the community. Crowdfunding is done transparently through smart contracts by swapping HBAR for the new projects token on the IDO platform. It is also a fair way of distributing the token, as the capped allocation for each participant mitigates the risk of whales creating an imbalance in token holdings. The team behind the projects and the IDO platform collaborate on the marketing and advertising efforts, while bringing the community and project together in one place.

After an IDO event, the token/coin is traded on a DEX via liquidity pools, with liquidity provided by project teams and token holders. Transactions are completed using self-custodial wallets, they are transparent and provide users with complete possession of all their tokens, while only requiring the gas fees of the network.

We carry a rigorous due diligence on all projects and only list vetted ones for an IDO. HeadStarter offers a personalized service with different options to projects when they are onboarded. HeadStarter IDOs are also regulatory friendly across permitted jurisdictions, which is why we request every investor to undergo KYC through a 3rd party entity. Unfortunately, this means people from certain regions, including the US, will not be able to participate. To learn more about the KYC process, check out [this article]

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