Steemit Crypto Academy Season 3 Week 5 | Initial Dex Offering (IDO) By @syedhuzaifa123
HELLO EVERYONE,
Hope you all are doing well. My name is Syed Huzaifa and I intend to write about the Initial Dex Offering (IDO) today. This is a homework post assigned by @wahyunahrul. Getting inspired to do well come from a good source of knowledge. So let's get right into today's topic.
Before answering the assigned question, I would like to start from the basics.
Before I introduce you guys to our topic Initial Dex Offering (IDO), Let's talk about the term DEX Which is a shortened form of Decentralized Exchange.
Decentralized Exchange:
If a transaction is being done in peer to peer fashion, this type of transaction is referred to as a decentralized trade. If a 3rd party gets involved in that transaction, it will lie in the trade of centralization.
https://images.app.goo.gl/K1Ps5NswC1utCKXNA
The transaction is done on a decentralized exchange give you complete control over your funds and a user can transfer those funds to another user directly over a blockchain without a 3rd party involvement.
INITIAL DEX OFFERING:
Simply put, launching a cryptocurrency on a decentralized exchange is referred to as Initial Dex Offering. An IDO is an event where a blockchain project is first launched to decentralized exchange in order to raise funds from retail investors.
IDOs have some similarities with initial exchange offerings (IEOs), when launching their token and lift funds via a centralized exchange.
This new strategy in the crypto world seeks the attention of all the investors thus so from now we have seen a rise in the new blockchain being launched using IDOs.
Should IDO Be Done On Cryptocurrency Or Not?
Before opening up my opinion, let's take an example. If a company wants to raise funds for a new product, the common solution for funding raising is to take a loan from a bank. However with the rise of cryptocurrencies like Bitcoin, companies started raising funds via selling their tokens in exchange of Bitcoin or Ethereum. The methods for doing so are Initial Exchange Offering or IEO, Initial Coin Offering or ICO and the one which is newist among them, Initial Dex Offering or IDO.
As we have learned that IDO is a method of raising funds via a decentralized exchange. If you ask my opinion, I would say that IDO should be done on a cryptocurrency. The advantage of IDO is that it provide a companies to launch their own token for the public reach in order to raise funds. If an IDO is done on a newly born cryptocurrency, the liquidity will starts increasing and sooner or later the coin or token will be recognised by investors and crypto users. For the purpose of gaining worth of a coin or token launched by a company, they have to placed a price in the liquidity pool.
liquidity is the ability of a coin to be convert into other cash or coins.
Can IDO have a significant impact on the cryptocurrency world?
Ofcourse the imact of IDO is very significant in the crypto world. The initial price offered by the IDO on a DEX platform pairing with other popular cryptos will provide a boost to the newbie token causing to attain a better price. IDO provides with transparency of the token on the blockchain so that a new investor or an old user have all the knowledge of what;s going on.
The most profitable advantage of IDO is the liquidity it provides to a token on a DEX.
IDO done on a cryptocurrency on a DEX provides it with a flexibiliy to easily trade the token on a decentralized exchange.
Explain one example of a token that has been IDO but failed/rug pull:
To make it more clear, let's talk about the term rug pull that what exactly it means.
Rug pull:A rug pull is an act of stealing and scam where a developer makes a project and then abandons the project and runs away with money from the investors.
TurtleDex a Binance Smart Chain (BSC) project was reported for rug pulled its investors after raising 9000 BND having worth of 2.5 million $. Immediately after the confirmation of the thievery, the worth of the protocol’s native token TTDX, reportedly reached to approximtely zero.
Make a detailed fundamental analysis of 2 tokens that have done IDO, and compare the two tokens. Then give your opinion on the results of your analysis.
The list of cryptos that have done IDO on any blockchain are many, so let's talk about the first token launched on Binance (DEX) with a new project, Raven Protocol.
1. RAVEN PROTOCOL:
While writing this post, the price of raven protocol is going down at a rate of 27.29% and currently its value is at 0.0009013$. Here in the snap below you can also see its market cap which is decreased by 27.29%. The trading volume of 24 hours is at 1179$ and it is increased by 16.76%. The Circulating Supply is at 4.47B RAVEN. The live market cap is $4,034,513.
Further below you can see the pairing of the coin with other popular coins like BNB and ETH. The top exchange in which raven is trading are in Binanace DEX and Bilaxy.
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2. CoinBurp:
CoinBurp is a decentralized token having a rank of #2805 in the market. At the current time, GMT 11:48 am 7/30/2021 the market price of CoinBurp is at $0.1485 decreasing with a percentage of 16.12%. The other parameters of the coins are not revealed. One can learn more about it from the link given below.
https://coinmarketcap.com/currencies/coinburp/
The pairing list of the coin with other popular coins are given below. The IDO of the blockchain is done on the decentralized exchanges like Uniswap.
Look for 1 token that is currently IDO and explain the steps to be able to participate in the IDO.
There are many token currently doing IDO but I'll go for Fanadise. Fanadise is a decentralized token on an DEX known as pancakeswap. PancakeSwap is a leading DEX on on Binance Smart Chain (BSC).
Here you can see all the detail of Fanadise.
https://coinmarketcap.com/currencies/fanadise/markets/
Fanadise is a cryptocurrency having a market rank at #2590 and at a price of $0.2302. The market cap of the currency is at $4,609,682. The Circulating Supply of the coin is 20,000,000.00 FAN. The volume per 24 hour is $14,584,973.
This image above shows the pairing of the coin with other popular coins and on which DEX is IDO has been done.
Steps to be able to participate in the IDO:
There are some requirements that has be perform by the participant in order to do an IDO on a project. These requirement are set from the IDO organizer. To take part in the event, it include:
1. Wallet:
Before starting anything, participant has to create a wallet on the DEX he want's to do IDO on. For example, if an indivitual wants to start his project on Uniswap DEX he has to create a wallet on Uniswap DEX.
https://images.app.goo.gl/V8xZ1agn7LscdCZk9
2. KYC/AML Registration:
https://images.app.goo.gl/eRZrK5BChX1gua1H7
Before explaning the new short form let's check out the abbrevation of these.
KYC stands for Know Your Customer.
AML stands for Anti-Money Laundering.
KYC is the process of verification in which the participants had to register the personal data. While AML is technique for tackling against the financial frauds.
KYC/AML Registration is a procedure which has to be obey by every project in order to do IDO event on the blockchain smoothly.
3. Whitelisting:
The next requirement for doing an IDO on a project is Whitelisting. Whitelisting is a sum of tasks that has to be performed by the participants in order to make the event done. The following task is to made an account on social media platforms like Facebook, Twitter, etc.
CONCLUSION:
So in today's homework post we have a deep learning about Initial DEX offering IDO and similar events like ICO and IEO. ICO is very new to the cryptocurrency world and I think that it is the most preferable event to be held in the crypto world. ICO is the event which provide a new project a popularity by launching it on a decentralized exchange DEX like Uniswap. Still there are fraud cases like TurtleDex which can also be seen in the protocol of IDO.
In this post we also learn that how a decentralized exchange is more secure as all the transaction are done in peer to peer fashion.
We also learned that how an individual can create his own project and create a liquidity pool for his exchange from other popular exchanges.
This lecture also contain the information on how to participate in IDO.
That is all from my side, hope you enjoyed reading the post. Take care and Goodbye :)
Regards,
@syedhuzaifa123
Special Mention to:
@wahyunahrul
#wahyunahrul-s3week5 #cryptoacademy #cryptocurrency #steemit #steemexclusive #steemit