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Initial Coin Offering-The New Capital Venture


Nov 28, 2017 Posted /  3918 Views


Initial Coin Offering-The New Capital Venture

In the last year or so, ICO stands for initial coin offerings has become the new source of the capital venture. It all started with the launch of Ethereum currency. Ethereum is a digital money which follows the principle of decentralization, under which directly or indirectly the government or any federal institution have the authorization to check and balance the supply of this currency. The working of this decentralized currency is similar to Bitcoin, here also, every transaction is verified and stored onto Blockchain ledger. And, this ledger is distributed over the network, so the chain of Ethereum cannot be hacked as there is no sole point of failure. Moreover, the transaction entry once made onto ledger cannot be deleted or manipulation of any sort.

Business Fundraising in 21st Century

In today's tech-dominated world small businesses and the startups have several options when it comes to generating funds for the implementation of their idea. Though bootstrapping can work for some companies, while most require hefty funds to get their business off the ground. ICO is nothing but is an easy way to crowdfunding.

Here, the company that need funds uses the Blockchain technology to create and issue their own cryptocurrency as a token to the investor for their funds, just like the capital venture. In the earlier days, the Bitcoin completely dominated the ICO market, slowly yet steadily Ethereum gaining grounds as the number one choice. There are a number of reasons for the explosive popularity of ICO, and some of them are highlighted here.

1  It Open Doors of Possibilities for Startups   

Undoubtedly, the ICO is an ocean of global investors looking to make worthy investments. A recent survey reported small businesses and startups believe 90% of the European and American eminent banks are misusing their power when it comes to offering funds, in name of hefty interest rates and baffling documentation work. This is why ICOs’ has become the new way of fundraising, as here, you don’t have to meet any eligibility criteria, just need to satisfy your investors that you have a worthy idea. Moreover, unlike bank funding, ICOs’ present you the complete global market of investors, everyone, in any nook and corner of the world can invest in your idea.

2. A Lower Cost to Address the Market of Global Investors

Nowadays, just about anyone can raise funds in no time, just by putting forth his or her revolutionary idea, this is the magnitude of power of Initial Coin Offerings. But, all thanks to the trustworthy technology, Blockchain and the way it processes the transactions. Consequently, backing ICOs to present startups and small businesses the added perk of addressing and managing a plethora of global investors within their tight budget. Before this, a Google-powered startup Ripple was widely employed by worldwide banks to settle financial transactions, but, as several reports suggest, it is seeing a serious dip of 33%. Thus, suggesting, terming Initial Coin Offering as a source of the capital venture is an absolute no-brainer.

It Offers Enhanced Liquidity

Another great benefit of the Blockchain based Initial Coin Offerings is that it presents your investors the luxury to trade the tokens, once the investment is made by them on an ICO campaign. Moreover, the company raising funds can also do the same, after the Initial Coin Offering. Thus, throw light on the truth that Initial Coin Offer presently increased liquidity as one of the great benefits of this new way of the capital venture. Plus, today the market is flooded with blockchain-based companies like the SLAT, offering quick loans.

Why Would Investors Invest in Icos?

Two to three years back, no one in the corporate domain was even aware of this unique source of the capital venture, and those, who were rated it has a waste of time and human resources. But, ICOs has boomed significantly, with 2.3$ billion raised till now for the year 2017 through Blockchain based ICOs. Its popularity augmented in no time with businesses and investors has found their own benefits.

For company raising funds, ICO is an easy and quick way to obtain funds for their venture, plus, ICOs comes with the added perks of easy after marketing and settlement costs are quite compared to traditional funding. The ICOs are also benefited by a massive network of global investor.

While the investors seeking to invest consider ICO as a viable option is all because of the growing global trend of cryptocurrencies. To understand this, Bitcoin has increased from $23 at the time of unveiling to more than $8,000 now. Thus, suggesting cryptocurrency investment is the modern age way of making your money multiple.


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Tags: initial coin offering startup Ripple Global Investors Invest in Icos Investors cryptocurrency Ethereum

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