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Why Firms are so Interested in Initial Coin Offerings, ICO

Mar 04, 2018 Posted /  1646 Views

Why Firms are so Interested in Initial Coin Offerings, ICO

The History of Initial Coin Offerings (ICOs)

Initial coin offering is an unregulated means through which crypto ventures raise investment capital. ICO was introduced to enable startup companies mainly cryptocurrency-based ones to raise capital without going through the complex route of raising capital from venture capitalists and Banks.

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Crypto-Firms or any other firms with intentions of raising money through an ICO usually create a white paper which is the full plan of the business and expected market and how the business would sustain itself. To gain more trust of the would-be investors the Autobiography of the project team is always added at the end of the white paper.

The first ICO was conducted by mastercoin around July 2013 followed by Ethereum which was an upcoming project at the time and successfully raised 3700 bitcoins during its ICO. Later that same year Karmacoin conducted ICO for its Karmashare project. This is basically the timeline of ICO adaptation.

Increase in the number of Cryptocurrency Ventures

The success of cryptocurrency ICOs has given rise to an exponential increase in the number of new projects seeking to gain investment capital through ICO. New projects ranging from traditional cryptocurrency exchanges to secondary modified projects now all seek for the vast funding potentials via ICOs.

The cryptocurrency and blockchain industry is emerging to become among the most successful sector in the financial industry. Scientist formerly working on information technologies programs are easily turning to become CEOs and project developers of some of the world’s most complex blockchain programs.

On the other hand, several cryptocurrencies are gaining unprecedented values after being started by an assuming CEOs who could not be certain enough that their crypto’s who rise in a nearby future. One such cryptocurrency is Ripple whose values has since increased and is attracting a couple of new investor’s funds.

Continuous Growth

Cryptocurrency is continuously growing both in terms of market capitalization and the number of available tokens on the market. Almost it is true to say a fully tokenized economy could be achieved by some countries by as soon as 2020. This growth coupled with the trust cryptocurrency is garnering is enabling crypto firms find a large base of people willing to invest a lot of money in their cryptocurrency projects.

Generally, a massive future growth is still expected to come towards ICO with a lot of established companies shifting their focus on ICO tokens as a means of raising investment capital for the company.

As cryptocurrency and tokenization continuously develop so is Initial coin Offering but the latter is not just limited to Fintech companies all companies including Ford motors or Lockheed aircraft manufacturers now have a potential to carry out an ICO.


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Tags: initial coin offerings ico Crypto-Firms cryptocurrency

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