What crypto exchange to choose for conducting an IEO? Consider BTCNEXT by Platinum Q DAO Engineering!
Like any business, the cryptocurrency industry is subject to the theory of a product life cycle: introduction, growth, maturity, and decline. It is obvious to assume that the first stage saw the light in far 2008 when Bitcoin was created. It took about 8 years to move to the second stage, but it was worth it. We went from $90 million raised by 29 ICOs in 2016, to over $6 billion of funds collected by 875 projects in 2017. One of the reasons for such a boom could be contributed to the nature of ICO itself. In particular, it allows startups to raise funds without having to worry about all the headaches and hassles of traditional IPOs.
Raising funds from VCs and banks can be a challenging and expensive process, where no one can guarantee any approval. Even if your project can save thousands of lives, some VCs might not invest in it. This problem was overcome with the emergence of an ICO mechanism that allowed anyone to buy tokens to support.
Through the first half of 2018, the cryptocurrency market was mostly bullish, which helped 2517 projects to conduct their very own Initial Coin Offerings. However, only 40% of them achieved their funding goals successfully, while 60% failed to do so. Since then, the market sentiment has been steadily deteriorating until unleashing the bursting of the crypto bubble. According to a study provided by Diar, in November of 2018, ICOs raised only $65 million.
Almost everyone thought this change could not but mean a drastic trend reversal, if not the end of an epoch. That’s exactly when the crypto community began talking about Security Token Offering as a reincarnation of token sale mechanism. Not only investors but also startups were optimistic that it will help to recover from the traumatic crisis. A couple of months later, people saw an Initial Exchange Offering as another promising tool: from the beginning of the year, through Binance Labs and Launchpad, BitTorrent raised $7.2 million in 18 minutes, and Fetch.AI recently raised $6 million in 22 seconds. At last, Celer Network raised the US $4 Million through Binance, after previously raising the US $30 Million.
Since the beginning of April, the capitalization of the cryptocurrency market has finally begun to grow, hinting an upcoming crypto spring. The success of the first IEOs on Binance could not but to draw the attention in this type of tokensales from the community and other cryptocurrency exchanges — Huobi, OKEX, BTCNEXT, Bittrex, Exmo, KuCoin, Gate, and others.
Does it mean that IEO is the simplest and most secure way of raising funds?
First, let’s mention that Initial Exchange Offering is almost a twin brother to an ICO, with the unique difference that IEO is conducted on an exchange. It means that IEO includes an intermediary in the form of cryptocurrency trading platform that conducts and supervises the sale. Additionally, IEOs are not as open for public as ICOs are: in order to participate in an IEO token sale, potential investors should register on that particular exchange, successfully pass KYC and AML procedures, and, finally, to be selected to contribute.
Startups, in turn, will need to have a product in demand with a high-quality MVP, in order to get the best cryptocurrency exchanges’ attention. Keep in mind that their reputation is on the table, so they will not risk it with one fraudulent or insecure company.
Overall, these requirements make IEO a safer and more convenient way of the token sale, for both for investors and projects. Contributors are protected from scam artists, whilst coin issuers can be assured in a listing guarantee. In addition, exchanges have ready-made fiat payment solutions, which is convenient for users.
What are the cons of an IEO?
Curiously, one of its biggest advantages is also a disadvantage that crypto exchanges are trying to solve. The number of people willing to participate in an IEO is very high, thus even those users who were registered are unable to purchase tokens. For example, a huge rush caused Celer token sale at Binance, for which 39,000 people registered, but only 3000 participants managed to buy tokens. Similar problems experienced users of Huobi and KuCoin exchanges.
“After mounting scrutiny, videos, and attention from the bulk of the KuCoin user base as well as the widespread crypto community, the KuCoin CEO (Michael Gan) reassured users that the platform would look into the possible usage of bots and explore potential solutions if evidence of such wasfound:”
What are the steps to participate in an Initial Exchange Offering?
Forming part of an IEO is a rather simple process than participating in an ICO.
- Double-check whether an IEO is actually going to be held
- Find out where an IEO will take place
In case of startups and cryptocurrency exchanges, it may require some time and investments in the latter case. Thankfully, there are more and more exchanges that can help to conduct IEO easily and successfully. For instance, Opiria, a large company, working with BMW, Nissan, Mercedes Benz, and Intel, has just had first rounds of an IEO, selling their PDATA token on various exchanges. They raised $330,000 during the first round on three exchanges. Then PDATA tokensale was conducted on 5 exchanges: Coineal, P2PB2B, Tokenize, ExMarkets, and BTCNEXT. At BTCNEXT exchange an amount of 106,250.00 USD was collected in just 3 hours! During the next round, BTCNEXT collected 126,000.00 USD for Opiria! The key to Opiria’s fundraising success isn’t only in the interesting idea of data marketplace and the overall success of the company itself, but also in the good execution of the token sale and the right choice of the exchanges.
BTCNEXT is a fast-growing spot and margin trading platform designed for both fresh and professional traders. The exchange provides multiple services such as spot trading, margin trading, IEO launchpad, OTC trading, and many others. BTCNEXT is focused on 24/7 responsive customer service and seeks to build trust relations with all of its users. Next IEOs to take place at BTCNEXT are IEOs of Q DAO family stablecoins by Platinum Q DAO Engineering. These stablecoins are backed by Bitcoin (as well as another top 10 digital assets in the near future) and pegged to various national currencies, including USD (USDQ stablecoins) and KRW (KRWQ stablecoin). The first round of Q DAO governance token IEO was on 1 June, and 15,000 Q DAO tokens were distributed during 1 hour. There will be 9 more rounds and the next one will be conducted in July 2019.
The IEO theme is quite popular in the crypto community, and every successful IEO such as Opiria’s one fuels the hope of a great future in the crypto market and until the hype exists, more and more startups will appeal to exchanges in order to conduct their very own Initial Exchange Offering.
BTCNEXT exchange, the next generation spot, and margin-trading platform has been developed by Platinum Q DAO Engineering, which has also brought USDQ and KRWQ to the market, looking to edge together innovative solutions in collateralization. They plan to achieve it by using stabilizing mechanisms and neural networks for high-endurance stable coins.
The one aspect of USDQ which makes it unique is that this stablecoin is decentralized. It has Bitcoin as a collateralized cryptocurrency debt backing up its value, instead of a centralized authority holding dollar bills, as in the case of Tether (USDT).
In order to protect investors’ funds, BTCNEXT developers have implemented more than 300 security measures. In the near future, users will be able to trade over a hundred types of tokens including Bitcoin, Ethereum, and Litecoin. For more information, visit their website and follow them on Twitter, Instagram, Telegram, Facebook, Medium, and LinkedIn.