| |
 |
|
| |
|
|
| |
IDO |
| |
An Initial DEX Offering is one of the recent strategies developed in the crypto and blockchain space to allow projects to raise funds. IDOs allow projects developed on blockchain to raise funds after selling their tokens on decentralized exchanges (DEXs).
IDOs, even though they are the latest development, have become increasingly popular crowdfunding models for decentralized finance (DeFi) and decentralized applications (DApps).
The first IDO was conducted by RAVEN on the Binance DEX in June 2019. The IDO was a success, and since then, more have sprouted in the market, including the Universal Market Access Protocol IDO and the SushiSwap IDO.
Projects that want to raise funds through an IDO offer their tokens on DEXs. DEXs offer a higher level of decentralization than CEXs. Some of the most popular DEXs are Uniswap and PancakeSwap. However, there are more of these exchanges in the market.
The projects use various coins such as Bitcoin, Ether and USDT to create a liquidity pool. Anyone who has a Web3 wallet supported by the exchange can then invest in the token. The best thing about DEXs is that there is no need for Know Your Customer (KYC) requirements or the need for any identification.
IDOs have characteristic differences from IEOs and ICOs. The project will not own any of the tokens raised during the fundraising process in an IDO. Moreover, IDOs are decentralized in that there is no strict set of rules and regulations that these projects need to follow.
IDOs have recorded significant growth over the past few months due to their diverse nature. Since the first IDO by RAVEN, this new funding method is now replacing traditional funds in the blockchain sector.
Pros
One of the main benefits of IDOs is that they boost liquidity for decentralized exchanges (DEXs). Decentralized exchanges control fewer trading volumes in the crypto space than centralized exchanges. Through IDOs, DEXs can hopefully fill this gap and gain control over a large share of the crypto trading volumes.
Moreover, IDOs provide a more decentralized way for projects in the crypto and blockchain sector to raise funds. IDOs are also compatible with DeFi protocols and liquidity pools, allowing them to tap into one of the spaces in the blockchain sector that are fast booming and becoming popular.
Cons
The IDO crowdfunding strategy is still new in the space. It is yet to gain the kind of traction that ICOs and IEOs have recorded over the past few years. This can be a disadvantage for projects that want to raise funds through IDOs because fewer funds are generally raised from the process.
On the side of the investor, there is limited knowledge about IDOs. It can be hard for the average investor to understand DEX launchpads. These launchpads are usually technical, and the usability can prove hard for those without adequate knowledge. |
| |
|
 |
| |
|
| |
| |
|
 |
Planet Koinos have received approval from Koinos Group
to use the Koinos Logo, images and text. 2022
For more information contact webmaster@planetkoinos.com |
| |
|
|
|
