The excitement surrounding the cryptocurrency is understandable. Where else can you get hundreds or even thousands of percent from the initial investment in the short term? Only in cryptocurrency.
Another thing is that you can’t earn so much on major cryptocurrencies (you can easily lose even). And therefore, the interest of users begins to shift towards young altcoins and what is called tokens. They are directly related to the ICO, which will be discussed today.
What is an ICO?
ICO – Initial Coin Offering, which means the initial placement of coins. As you probably know, cryptocurrency in general and tokens in particular are often called coins. Those. This concept is closely connected with the crypto world, and without it it makes no sense to talk about it.
How to make money on it?
Suppose you have an idea and you need money to implement it. You organize an ICO and receive money for your project from people who believe in you, giving them in return for money tokens of a new, just invented cryptocurrency at a fairly small price.
Having collected the necessary amount, you are implementing your project. For some reason (the success of the project or as a result of PR), the cost of your new altcoin is growing, and the one who bought it from you at the time of the ICO will now be able to sell it on the stock exchange tens or even hundreds of times more expensive.
Who benefits from this?
To you, as the organizer of the ICO, because you have raised money (investments) without attracting loans and generally no guarantees. This procedure itself is now almost everywhere illegal, i.e. This process is in no way regulated by anyone – everything is on trust. But this is money, and without any guarantee of return. Of course, it is profitable for me and any other organizer.
Those who bought new tokens (altcoins) at the time of the initial placement of coins (or even a little earlier, at an even lower price with the so-called Pre-ICO). After all, after that they will be able to sell new coins on crypto exchanges much more expensive (at times, at least).
Thus, it turns out that conducting an ICO business is beneficial for both investors and project organizers.