Cryptocurrency or overall Blockchain systems is potent to alter the global financial systems. At least every economic and industrial solution related to accounting, automation, surveillance, transaction, and everything has its blockchain version. Decentralized application, Hyperledger, and fundraising, everything related to finance is available with blockchain.
The recent moving feature of blockchain technology is ICO and IEO. Both of these systems are processes to raise funds, especially for cryptocurrency-related projects. An ICO development company develops investor-friendly projects and tokens capable of getting future outsourcing and funding; IEO development solely depends on exchanges. A similar process like IPO or Initial Public Offering is available within the business arena; the blockchain’s version is more secure and offers immense blockchain-based services.
But, IEO and ICO both of these systems have their pros and cons. Let’s understand IEO and ICO with a clear difference between them.
A Brief on Initial Exchange Offering (IEO) and Initial Coin Offering (ICO)
Initial Exchange Offering, also known as IEO, is a new-age version of ICO. Initial Exchange Offering is the process of channelizing a blockchain or cryptocurrency venture through exchange platforms. Exchanges perform an intermediate approach between the inventors and the startup companies in exchange for fees generated by the fundraising process. Initial Exchange Offering isn’t far different from Initial Coin Offering, but there are some great differences; we’ve explained them later.
Initial Coin Offering, alias ICO, is similar to the real-world initial public offering. Companies providing initial coin offerings are attracting investors to invest in their venture to create blockchain-centric products or services.
Convinced investors buy initial coin offerings from that venture, where those coins provide some utilizing value. Also, ICO launching companies offer their products or services, also proportionate company stakes to investors through those coins. More or less, it’s a give-and-take relationship between investors and venture launchers through those coins.
Now, we have a clear concept of IEO & ICO, so let us waste no more time and jump into the points of differences between them.
Key Points of Differences between IEO and ICO
- IEO ventures rely on established platforms to devise and market their cryptocurrency startup. Of course, an established platform will excel the limitations of marketing a venture on its own.ICO ventures keep their security and integrity by managing their own project on their own. By means, there’s no helping hand to pitch to investors, create persuasive white papers and manage and sell the tokens.The first system works better for a few startups lacking the resources to lead proper project management. The second one is good for projects that have robust power to channel their own venture.
- As previously depicted, an ICO project runs over with the power of developers and startup founders. IEO projects have an institutional and professional backup as the exchange platform and their services.Previously, numerous ICO projects have shown fraudulent and mischief cases, where that venture attempts unpromised project activities or goes undercover. So, it’s no mistake that while investing in ICO projects, investors are bearing unwanted risks.IEO projects are professionally handled by IEO analysts and exchange developers. Any error with the projects gets adequate attention and healing. So, that’s why IEO projects are considered safe. Generally, investors choose more IEO projects than ICO projects.
- ICO projects can attract attention from investors all around the world with proper audience research and attracting target audiences. IEO projects can only attract investors having an exchange account or regularly participate in exchange-related workings.Moreover, marketing ICO projects is way tougher than IEO projects for a broader marketing funnel which increases marketing and pitching expenses. IEO projects are easy targeting as investors having relation with exchange gets direct recommendation of new projects preparing for selling. Consequently, the IEO projects are easily traceable, and exchange platforms analyze the market and find out the target audience base; that’s how they save money.
- In case someone’s launching an ICO or IEo project, tokes require exchanges to list up and create attraction among people. ICO projects run with the probability of high listing time. This means ICO projects take more time to get listed on exchange platforms. At the same time, IEO projects get listed in relevant exchange platforms after a few settlement days.IEO projects pay well to IEO analysts and developers as service fees and listing prices. Also, IEO exchanges have regular investors grinding more meaningful and valuable ventures. So, ICO projects lack the chance of getting listed as IEo projects. This probability factor marks IEO as the more convenient and best choice among startups and investors.
- Lastly, IEO systems question the basic and central feature of a blockchain system. Blockchain systems offer innate decentralization amongst all participants and systems. But, ICO projects maintain a decentralization approach by not providing the administration roles to exchange, especially a third party.From the opposite perspective, IEOs are better than ICOs in terms of marketing, efficiency, and all the terms that startups and investors seek and wish to have.
After going through the points discussed above, the differences between IEO and ICO seem quite clear. Both IEO and ICO development has gained a lot of popularity over the past few years owing to the benefits they offer. Therefore, different companies are calling in for the help of professional IEO and ICO development services to leverage their potential to the fullest in their businesses.
Conclusion
It’s not a call for choosing IEO over ICO or the opposite, just sharing the basic differences these two technologies possess. Handling ICO projects for a company is tough. White-paper creation, token selling management, and fund allocation are pretty tough tasks to manage which require adequate management as well as technical development skills to work on. So, it’s recommended to get in touch with any veteran ICO development services to ensure fruitful results.
