What is an initial coin offering (ICO)?

by gabriel.kutch , in category: Cryptocurrencies , 10 months ago

What is an initial coin offering (ICO)?

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1 answer

by augustus.ziemann , 10 months ago


An initial coin offering (ICO) is a fundraising method used by companies or startups to raise capital in the form of digital currency or cryptocurrency. It is similar to an Initial Public Offering (IPO) in the traditional financial market. During an ICO, the company sells a certain number of tokens or coins to investors in exchange for established cryptocurrencies like Bitcoin or Ethereum. These tokens can later be used within the company's ecosystem or traded on cryptocurrency exchanges. ICOs enable companies to raise funds for their projects without the need for traditional financial intermediaries, like banks or venture capitalists. However, ICOs are subject to regulatory scrutiny due to potential scams or fraudulent activities in the cryptocurrency market.