What Is An ICO and How Does It Work? |
Posted: December 18, 2020 |
As you are here, perhaps you are not aware of an ICO and are looking forward to learning more about it. This article is solely dedicated to simplifying an ICO and how does it work in simple words. However, before jumping into the details, you must know that ICO and its working process is directly relevant to cryptocurrency, Ether, and other forms of online exchange. WHAT DOES AN ICO MEAN? To begin with, ICO stands for Initial Coin Offering, and this is the new way to gather all the capital with the view to facilitating the block-chain related tasks or projects through cryptocurrency. To be more specific and in simple words, new projects use it to sell freshly minted crypto tokens in exchange for Bitcoin, Ether, other cryptocurrencies. Moreover, ICO in terms of its nature resembles Initial Public Offerings (IPO), though ICO doesn't offer full ownership to the investors because most of these are not regulated. BENEFITS OF ICO While ICO is still considered as the latest form of investment module, from an ICO, both parties--- investors and token issuers, get benefited. Let's look at what benefits does an ICO offer: Benefits for Investors
Benefits for Token Issuers
HOW DOES ICO WORKS? Now that you are well aware of an ICO and how it benefits both investors' and ticket issuers' ends, it is time to reveal how this ICO works actually. If you have guessed that understanding an ICO and its process is very critical, you are oblivious to its actual process. In simple words, it all started with a whitepaper that contains the details of a project or company to the ICO process. In order to make the whitepaper more justified, it also comprises its intentions to hold an ICO that to some extent explains the project, its goals, how much capital it needs to raise when the ICO is scheduled, and other information relevant to investors’ interest. After going through the whitepaper, if an investor finds it exciting and willing to make an investment, they receive the project’s cryptocurrency, also known as a token. Based on the project's nature, tickets may be acquired in exchange for other cryptocurrencies or fiat money like US dollars, euros, and available currencies. Through the ICO working process, many startups or companies get enough capital to kick-off or expand their market as they are, in other words, selling shares or bonds for cryptocurrency to the investors. Read more articles about investment at https://credit.holdings/
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