What is IDO in Cryptocurrency?
ICO, IEO, and the Like IDO or the Initial Dex Offering is a fundraising process that is carried out to obtain early access/purchase of crypto tokens before they are listed on the market. Usually, this Initial Dex Offering is carried out by a Launchpad, a special place where tokens can be obtained by investors before they are listed.
Many believe that the Initial Dex Offering is safer than the old system like ICO (Initial Coin Offering), because the fundraising is carried out by a launchpad, not the related project developer. So if something unexpected happens, the launchpad can return the funds to all its investors.
And it will be even safer if we follow IEO (Initial Exchange Offering), or the initial fundraising carried out by the Exchange, such as Binance, Huobi, Kucoin, and many more.
IDO Advantages:
- Investors will get the cheapest possible token price before the token is listed on the market. The possibility of a token’s price increase from IDO can reach 1000% or 10 times the purchase price.
- Faster return on investment compared to regular trading.
- Safer than ICO, and easier than IEO.
IDO Disadvantages:
- To participate in a new IDO token, investors usually need to Stake the related launchpad token to obtain the allocation of new tokens.
For example, if we join IDO at Launchpad AAA to obtain token BBB. Then, we have to buy AAA token first and do the staking, then we will get the BBB token. So a large capital is required to participate in the Initial Dex Offering.
In addition, when you get the token later, you have to race quickly to sell the token, before the price dumps or drops. But for long-term holders, it’s up to you friends.
