[Initial Exchange Offering and Binance Launchpad] - Crypto Academy / S5W6 - Homework post for nane15.
Hello everyone. This is @sherazsultan. This season of steemit crypto academy is going smoothly by spreading tremendous of knowledge related to the crypto market. In this week, professor @nane15 has delivered lecture about the Initial Exchange Offering and Binance Launchpad. Let start the assignment of this week
.png)
Question 1. Explain in your own words what an IEO is.
The Blockchain is revolutionizing the whole system of the world. This is being utilizing in multiple field of the life. Its usage has changed the way of working and minimize the human effort. This is very big technology. Each blockchain project is developed with huge effort of the developers. These big blockchain projects required a lot of money to launch the blockchain project for usage. The developers of the blockchain projects required a huge amount of money to develop and to launch their project. They raise money through different methods. There are multiple ways to generate the funds for development of the blockchain project like Initial coin offering, Initial game offering, initial exchange offering, etc.
The IEO is a term use for the Initial Exchange Offering. This is a method to raise the funds for the development of the crypto currencies projects. The developers need the capital for the startup of the blockchain projects. The exchange market is a place where the traders buy or sell the crypto coins. They buy the crypto coins and sell them just to raise the money.
So in IEO, the exchange markets are being used to raise the funds for the start up of the crypto projects. Exchange work as the middle man to raise the funds through the IEO. Here the buyers and sellers perform their transactions. The Blockchain developers used the exchanges to make the capital for their projects because on exchange platform, there are a lot of people who are willing to invest their money in the blockchain projects. These investor's money are being used by the developers to develop and launch their projects.
The investors buy the tokens of the blockchain projects which still not have been launched. These tokens are being bough on the exchange markets. There investment use for the launching of the blockchain projects. When the project get launched, the investors then sell their tokens comparatively at high price and earn reward.
The price of the coin before launching the project is very low. The investors buy the coins at low price and when the project get launched, the price of coin is expected to raise up. And the investors make money by selling coin then.
This is very popular way to make the money for the blockchain projects. The developers pre sale their tokens on any exchange platform before launching the project. To list the token for the sale on the exchange platform, the developers need to pay some fee. These tokens are not allowed to invest for the common public. Only the exchange user's are allowed to invest in the tokens which are presented in pre sale in IEO.
Difference Between an IEO and IEO
Before the IEO, the ICO was a method to raise the capital for the blockchain projects. But there are a lot of risks of losing money in ICO. There may be a lose of capital of both investors and the developers. To overcome all the deficiencies which were there in ICO process, the IEO was introduced.
In ICO, the people can buy the token directly from the developer of the blockchain project. They buy the token by contacting to the blockchain developer. But in IEO, the people buy the tokens which are available in the presale from the exchange markets. The developers not sale the tokens directly to the users. Here the exchange work as the middle man. The investors buy the tokens on the exchange markets
Question 2- Do you consider IEOs an advantageous way to make an investment? Explain.
The IEO is very beneficial for the investors to make investment. This is very popular way to raise the funds for the start up of the blockchain projects. The developers use this way to make the capital for their projects. This reduce the risk which are their for the investors in presale of any token. The risk of the losing investment get minimize in IEO as compare to other fund raising methods.
This is perfect way to raise the capital in short time period. The developers can achieve their big goals in short timing. There is low risk of losing money for the investors too. This activity is done using the centralized exchange platform. The centralized exchange platform has a proper team for the maintenance of the system. The exchange verify the projects thoroughly before listing it on the exchange for pre sale. Thus is is very secure way of making the investment for the investors because they know that the project in which they are going to invest is very secure and verified by the exchange.
The IEO is very big opportunity for the investors to make the profit. They buy the coins at very low price n pre sale of the tokens on the centralized exchange platform. When the project get launched, the price of the coin is expected to get high. Then the investors sale their coins and make profit. SO IEO is very advantageous for the investors.
The coins which are there for pre sale on any exchange platform for making capital are more beneficial because these coins then get high support after that and the price of coin is expected to raise up which will be profitable for the investors.
The Centralized exchange work as the middle source in the IEO. Thus it become more safer for the investors as compare to the ICO where the developers sell the coins directly to the users. The users need to pay to the developers for buying the tokens.
This is also excellent for the new comers of the crypto world. The new comers who do not have proper knowledge about the project can even participate in the IEO by buying the coins from the exchange platform. This is very simple process where the investors do not need to do the proper study before making the investment.
Question 3. List advantages and disadvantages of participating in an IEO?
Advantages
- Best for the investors
This is best opportunity for the investors to make money. They buy the coins at low price and then sell them after launching the project at high price and make profit.
- Beneficial for project's developers
The blockchain project developers raise the fund through the IEO. They offer their coins for the pre sale on any centralized exchange platform. The developers achieve their long term goals in short time period. This is very useful and the beneficial for the developers too.
- Safe to invest
The centralized exchange work as the middle party. The coin get listed on the exchange for pre sale only if it is verified and useful for the people. Thus it is safe to invest in the IEO.
- Secure
The project first verified by the exchange platform. If the project is verified, then it is listed otherwise, the exchange do not list it on it. Thus we can say that the token which is offered for IEO on any exchange platform is safe from all the risks and scammers.
- High profit
The coins which are listed on the exchange for the initial exchange offering usually get high support after that. SO the IEO is very profitable and the investors get the high reward for investing in IEO.
Disadvantages
- Not for public
The IEO is not for the common public. Not the common people are allowed to invest in IEO. Only the users of the exchange platform are allowed to invest in IEO.
- Price may go in opposite direction
It may happen some time that after launching the project, the coin goes down. The price fall because of which, the investors may sometime face the lose. So this is not right to say that IEO is always beneficial because some time the coins change their direction downward.
- Multiple Tokens
The number of the tokens for the pre selling through the IEO is increasing day by day. Thus it become hard for the exchange to verify all the project. Some time they list the token without verification process because of which, the risk of losing money for the investors get high.
- The developers pay the fee
The investors need to pay the fee for listing their tokens on the exchange for IEO. This fee is according to the percentage of the tokens which are there for pre sale in IEO.
- Price start declining
This may happen sometime, that the price of coin fall because of low buying pressure after launching the project. In pre sale activity, there wee a lot of the investors. Because of high buying pressure, the coin's price get high. But then the price start declining when the project get launched and because of low buying pressure, the price decline.
Question 4. Explain how to participate in an IEO, for the process explore various exchanges, choose one of them and explain the process. (Please use from screenshots.) (No need to participate, just register, present proof of verified account and explain the whole process, do not use Binance
There are a lot of the website which provide information about the outgoing, ongoing and upcoming IEO opportunities. Before buying the coin, you first need to check the credibility of the exchange which offer the IEO. This matter a lot. Then choose the coin which are offering the IEO of your own choice and then there is a proper process to buy the coin.
The below is the Kucoin website which provide a list of the IEO opportunities.
.png)
The below is the Bitfinex which provide a list of the coin which are offered for IEO.
.png)
The below is the coindex which provide a list of the coin which are offered for IEO.
.png)
- Step by step on how to Participate in IEO
I first visit the bitfinex for checking the ongoing IEO on the platform.
I clicked on the first IEO and the below page appeared to me.
_LI.jpg)
The below is the project detail and exchange information.
.png)
This coin is available for presale on Bitfinex. So i clicked on the Visit Launchpad, Then a new page will be appeared which offer you the coin for IEO. The below page was landed when i clicked on the Visit Launchpad button. I clicked on the sign up button.
_LI.jpg)
.png)
I entered my name, password which must consist of 8 character among which one should be upper case and atleast on should be special character. Then i entered email address, country name and after filling all the fields, i clicked on the Sign Up Button.
.png)
.png)
Next they send me a code on email, i copied that from email and paste it over here. After doing the three steps verification, i have created the account succesfully..png)
.png)
Now i am able to buy the coins. I just enter my username and password to open the account.
.png)
_LI.jpg)
Question 5. As an example of a project that had a successful IEO, explain that project. Be on topic. (Use from screenshots.)
The Bitorrent is a well known and the famous project which had the successful IEO. The IEO of the bitorrent project held on the binance blockchain. This is a decentralized project where there is no third person or middle man. The users are allowed to share the files directly without involvement of the third person. The BTT was the name of token of this project which was listed for the pre sale in IEO on the binance exchange market in 2019. The TRX and BNB were used to buy the BTT. The 35,640,000k BTT were supplied for TRX which was lasted for 15 minutes on binance exchange. On the other hand, the total 23,760,000k BNB were supplied for the BNB session which was lasted for 13 minute in IEO.
These were two session in which the IEO of the BTT were presented for Pre sale. The people were able to buy the minimum BTT as 100k and maximum 166,666k BTT in this IEO. This attracted the attention of a large community around the world. The price of BTT were increased after this IEO so the investors got huge profit. Total hard cap was $ 7,200,000 and total raised was $ 7,200,000. The total allocation was below
- Total supply= 990,000,000,000
- For sale= 168,300,000,000(17.00%)
- Public sale= 59,400,000,000(6.00%)
.png)
.png)
.png)
Conclusion
The IEO is a term use for the Initial Exchange Offering. This is a method to raise the funds for the development of the crypto currencies projects. The Blockchain developers used the exchanges to make the capital for their projects because on exchange platform, there are a lot of people who are willing to invest their money in the blockchain projects. These investor's money are being used by the developers to develop and launch their projects.
The price of the coin before launching the project is very low. The investors buy the coins at low price and when the project get launched, the price of coin is expected to raise up. And the investors make money by selling coin then. The IEO is very beneficial for the investors to make investment. The risk of the losing investment get minimize in IEO as compare to other fund raising methods. The Centralized exchange work as the middle source in the IEO. Multiple IEO had been there which had ended in successful way. We have studied BTT IEO above.
Special thanks to professor @nane15 for giving us such informative lecture.
Sort: Trending
Loading...