IEO in crypto refers to the Initial Exchange Offering system in cryptocurrency, which is primarily used for fundraising by startup companies. This initial exchange offering system in crypto has developed recently; it is more of a crowdfunding based strategy for blockchain occupying endeavors. In an initial exchange offering, a cryptocurrency exchange plays the role of the intermediary. The exchanges list the tokens on behalf of the startup and transfer the sale in return of other cryptocurrency on behalf of the investor.

crypto system

Understanding an IEO in Crypto
While going for an Initial Exchange Offering, either be a complete startup trying to fund itself via the crypto platform, or an established business, that is trying to fund some new project as a startup.

In both the cases, the startup issues some tokens and gets them listed on the crypto exchange IEO platform, for example the Launchpad from Binance.

The platform charges some nominal listing fee and offers these tokens to its already existing user base. Therefore, one side effect of an IEO in crypto is that you can sell only to the existing users and not to general public. However this is also positive in the sense that the exchange already has a metrics established for rating the genuineness and credibility of each of its accounts. Therefore, the tokens are sold in safe hands from the fundraiser’s point of view, and there are no chances of scam of fraudulent sales.

Next once the sale is made, the exchange charges some commission from the startup for the sale activity.

If the startup wants to sell multiple tokens, multiple in terms of origination or based on different projects, it can do so under a single KYC on the exchange. There is absolutely no need of a fresh KYC each time.

crypto trading systems

Why is a Platform like Required
Binance was the pioneer in IEO with its Binance Launchpad in the late 2017. More exchanges have joined in, but Binance still maintains the flagship. But, Binance has a very strict evaluation process in place, before it would let you list an IEO on its exchange.

Many companies are therefore hiring experts, like to optimize their tokens and their white papers, so as to get a listing on Binance.

Another advantage of using is that it acts like a self-accreditation mechanism for your token when Binance evaluates it.

Next, Binance first reaches an agreement with the project team before it lists their IEO. So it is always commendable if you can have an expert in these contract matters representing from your side, to optimize the agreement as per your profitability.

With a lot of years in this trade, and definitely being in practice since late 2018, when the first IEO was launched, knows why projects fail to get themselves listed, while what are the factors that help them in getting these listings. Using such experience is always good and time saving.