Would you like to be part of a new cryptocurrency right from the start? Then you could invest in an ICO. What is ICO cryptocurrency? In this article, we explain what an ICO is and how it works.
So, what is ICO in cryptocurrency? The abbreviation ICO stands for Initial Coin Offering and is derived from IPO (= Initial Public Offering). In an IPO, investors buy newly issued shares. With an ICO, investors buy a newly issued cryptocurrency. In an ICO, no shares in a company are acquired, only digital coins or tokens.
Anyone who buys an ICO coin pays a price that an issuing company charges for it. There is no such thing as trading like an exchange with price determinations. With every ICO there is a risk that a coin or token will lose its value and all of the capital invested will be lost as well. In return, there are high chances of winning — if the result is favorable, a value of an ICO can increase significantly.
What is ICO Token Cryptocurrency: Main Types of ICO
Once we’ve found out an answer on a ‘What is ICO over mean in cryptocurrency?’ question, let’s talk about the main types of ICO. So, what types of ICO are there?
ICOs can be divided into several categories with regard to the properties of the issued tokens. What is ICO token cryptocurrency? We’ll find out now as well!
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- Currency Tokens. The best example of this type is Bitcoin. Currency tokens are digital means of payment and thus digital coins. They serve no other purpose.
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- Utility Tokens. Ethereum was the very first utility token. Utility tokens allow their owner to fix something. Ether is a utility token which allows the use of smart contracts on the Ethereum blockchain. At the same time, it’s also a currency token because the tokens have a value and can be traded.
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- Asset Tokens. Asset tokens refer to an asset. A holder of the token has a right to use an asset to a specified extent and for a specified period of time.
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- EquityTokens. Equity tokens certify ownership and control of something. Equity tokens can boast of a tremendous amount of potential.
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- Status Tokens. An owner of status tokens enjoys a higher reputation in an application as well as advantages associated. Having many status tokens on partner exchanges can lead to increased visibility.
What is ICO over Mean in Cryptocurrency: Key Steps of an ICO
What is ICO point cryptocurrency? What is the process of an ICO? Let’s try to find out! An ICO is accompanied by a lot of marketing activity. In the first step, a date on which the ICO will start is announced. From this day, investors can purchase coins or tokens. The period of am ICO is fixed from the start. Most developers define goals in terms of the sum to be collected.
As part of a roadshow, a story of a project including team, developers, and white paper will be presented. Developers hope for as much feedback in social networks as possible at every step.
An ICO ends at the specified time. Anyone who has invested up to this point has a fixed number of coins which cannot be returned. What happens to tokens that weren’t distributed is determined in advance — they are often destroyed. A return of coins is usually not possible. What is ICO cryptocurrency? If an ICO was successful, a coin will soon be tradable on crypto exchanges. Anyone who has purchased an ICO cryptocurrency can sell it there.
What is ICO Cryptocurrency: What Role Does a Token Play?
What is ICO in cryptocurrency? Will a project get better because it’s implemented with tokens? Without a specific token reference, it will be difficult to convince users to use a token. Just remember — with an ICO, you don’t invest in company’s shares, but in a currency that is used in a company’s specific environment. If a company is successful but an ICO coin isn’t used later, you will receive nothing.
How to Increase Demand for a Token?
When buying a token, just hope for price increases. In order for a price of a token to rise, demand must exceed supply. An offer is available from the first day of an ICO. But what increased demand? Every ICO should aim to list an ICO coin as quickly as possible on many liquid trading platforms. This ensures liquidity and contributes to demand.
What is ICO crypto? What do you know about it? Just share your knowledge in the comments!
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