Are ICOs making room for IEOs or STOs? Interesting times for crypto 2.0

 Initial Coin Offering (ICOs) have been used to raise capital by over 5,400 organisations, with the largest amount of money being generated was EOS,that reportedly raised $4.3 Billion followed by Telegram with $1.7 Billion so it is not hard to see why ICOs have attracted so much attention globally.This type of crowdfunding is being replaced by Initial Exchange offerings (IEOs) which in many ways is very similar to an ICO apart from with an IEO it is launched and managed by a Digital exchange instead of the organisation that created the token. The exchange typically carries out due diligence of the token to be issued and holds and sells the tokens on behalf of the project team. The buyers of the IEO are the exiting members of the Digital exchange and so while this means that there are considerable savings in terms of marketing and promotional costs many of the exchanges that offer IEOs are charging companies to have access to their distribution capabilities.

ICOs & IEOs

It is ironic that ICOs offered the ability for anyone to get access to the potential profits of a token rising in value in a highly decentralised manner. IEOs seem to be moving back to a more centralised model, where investors will need to “sign up” to particular exchanges to get access to individual IEOs and be subject to compliance and regulation. Although, this more centralised style could appeal to regulators, as they may impose regulations on exchanges issuing IEOs and in effect treat them like a Nominated Adviser (NOMAD) or corporate broker.

And STOs too?

We are starting to see more asset backed tokens i.e. Security Token Offerings (STOs) that offer the ability to trade property, commodities, publicly quoted and private shares, and bonds. The institutions that are more likely to buy these STOs, ought to draw comfort from this enhanced level of regulation that IEOs may bring.

https://blokt.com/guides/what-is-an-ieo-initial-exchange-offerings-explained

Crypto 2.o

Jonny Fry writes regularly for Irish Tech News, see more articles by him here.

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Blockchains can help

A research group in the University of Basel, in Switzerland, called Center for Innovative Finance, has been working on a project to put academic qualifications onto a Blockchain. Interestingly, it took less than two weeks to complete this initiative, demonstrating that using Blockchain technology can be implemented quickly.

Away from academia, the commercial world is also exploring the use of Blockchain-powered solutions to store qualifications with the Institute of Chartered Accountants of Scotland doing a trial with PWC staff.

Governments are also using Blockchain technology to store educational qualifications. The Singapore government has developed “OpenCerts”,  where it is possible to check qualifications from a variety of different academic institutions online, and so help potential employers identify fraudulent CVs.

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