Today we are starting a series of articles in which we will talk about ways to make money on the crypto market, using not only exchange rate fluctuations and exchange trading.
Participation in ICO and IEO
The ICO (Initial Coin Offerings) format has actually discredited itself to date, and the main problem is not even in scammers, but in the fact that most projects fail to bring their assets to the exchange and conduct a listing.
And if the project tokens are not traded on the exchange, no matter how good the idea is, your asset will not be liquid and, as a result, in 99% of cases it is useless.
Therefore, today, before participating in ICO projects, we would recommend you to think many times and weigh all the pros and cons.
IEO (Initial Exchange Offering) is a completely different matter – the initial exchange offer, which is held on the exchange platform. Unlike Initial Coin Offerings (ICO), IEO is managed by the exchange on behalf of a startup that is trying to raise funds using its newly issued tokens.
Since the token sale is carried out on the exchange platform, token issuers must pay the listing fee along with the percentage of tokens sold during the IEO. In turn, tokens of crypto startups are sold on the exchange’s platforms, and their coins are transferred after the end of the IEO.
IEO participants do not send money to a smart-contract. Instead, they must create an account on the exchange platform where the IEO is held. Participants then deposit funds into their exchange wallets using coins and use these funds to purchase tokens from the fundraising company.
One of the main advantages of IEO is trust. Since the crowdsale is conducted on the exchange platform, the counterparty reviews every project that wants to launch IEO on their website. Exchanges do this to maintain a good reputation by carefully checking token issuers.
Thus, the IEO may exclude fraudulent and dubious projects because of the involvement of funds through the stock exchange platforms.
Since the token listing is also “included in the transaction”, this is a natural process when the exchange conducts an IEO listing of a token startup after the end of the crowdsale.
More and more exchanges started creating IEO. One of the first in the line was Binance, which released its IEO Binance Launchpad platform.
In January 2019, BitTorrent, purchased by TRON, initiated a token sale on Binance Launchpad and raised $ 7.2 million in less than 15 minutes. The next IEO on the platform broke this record and closed in just 22 seconds.
Following the success of Binance Launchpad, other well-known exchanges have announced the launch of their own IEO platforms. Among the IEO platforms it is possible to allocate Bitmax Launchpad, Bittrex IEO.
Now IEO is one of the most profitable ways to earn money, in addition to standard trading.
Tokens purchased on IEO will grow in 90% of cases when listed on the exchange.
In addition, your chances of getting scammed are minimal.
Until recently, one of the best platforms was the Binance Launchpad platform, but at the moment, due to changes in the algorithm, it has become difficult to get into the number of willing traders to participate in IEO projects.
The Launchpad IEO platform by the Bitmax exchange feels quite good.
At the same time, the exchange launched this platform with its own BNIX token (https://www.bnix.info), the project is interesting.
It is difficult to say how the asset will move in the future, but we can say for sure that in the first time after the IEO, the asset will be liquid and, as a result, it will definitely grow for the first time.
At the same time, the exchange made a questionable decision, following the path of Binance, and gave the privilege of buying on IEO to holders of their BNIX tokens – time will show how justified this is.
In General, your task at IEO is as follows:
1. Analyze the project;
2. Try to purchase tokens on IEO;
3. Monitor the market when listing. We do not recommend selling the entire asset at once at the beginning of the listing, but you can sell part of the asset and already return your investment reaching the break-even point.
Based on exchange practice, the margin on some IEO projects is up to 200%, which is why most traders always track new IEO and listings on exchanges.
We would be glad if this article is useful to you.
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