Opulence Of Crypto Offerings 2/2

Dominik Olech
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We’re back with our guide for different types of offerings in the cryptocurrency industry. Let’s take a look at even more ideas about how crypto business can get funds.

In the previous part, we have brought you closer to some major types of crypto offerings in our industry. This time, we focus on some new approaches to this subject. There are less known yet promising ideas to develop a sufficient investment system for cryptocurrency projects.

Future-oriented eyes

Let’s start with a new invention among crypto – Initial Futures Offerings (IFOs). So new, that tokens offered in it don’t even exist yet. The idea is oriented on so-called future contracts (or simply “futures”). They are a form of agreement to buy or sell an asset at a predetermined price with a fixed date when parties will be obliged to trade.

We already mentioned crypto futures in the context of Bakkt. But the story of IFO begins with CoinFLEX, first cryptocurrency futures exchanges. The project, supported by Polychain Capital and well-known crypto figure Roger Ver, has already launched futures for some well-known cryptocurrencies like Bitcoin or Ethereum. But in July 2019, CoinFLEX issued the first initial futures offering for Polkadot. Linked to the project DOT token is still yet to be launched, but people interested in acquiring it can already buy futures.

This brand new concept in the cryptocurrency industry still needs to be verified. On the one hand, IFO allows more flexibility for investors, with the lower purchase price and less strict KYC policy. But on the other hand, it also might lead to more risky investments, and as a consequence, a throwback with ICO situations. However, let’s not get ahead of the facts and give a chance to IFO and Polkadot token.

The one with decentralized assets

Our next two examples use the same acronym: IDO, what may be a little confusing. In the first case, it stands for “Initial Dex Offering.” And as you can see, we have here an unusual case of acronym in the acronym. The word “Dex” means “decentralized exchange.” As the name suggests, this crypto entity allows peer-to-peer trading of cryptocurrencies, without any centralized authority. 

The first initial dex offering has been launched by the Binance DEX platform. What differs that kind of crypto fundraising scheme from the others? Basically, it works similar to ICO, but gathered funds aren’t held by one central party. In this way, the possibility of a potential scam is noticeably smaller, since no person would run away with your money.

Everything in this solution seems perfect. Genuinely decentralized exchange with users holding full control over their assets. So, where is the catch? First, these exchanges aren’t decentralized in 100%. For instance, Binance DEX is still, somehow, related to Changpeng Zhao’s company. The other thing is the popularity of this idea, which still needs more attention to make it a considerable option.

The one with a digital offering

And finally, we have the youngest member of our crypto offering family. Initial Digital Offering is a brand new term, introduced last month by Swiss Digital Exchange, a blockchain-based branch of stock exchange company named SIX Group. The offering expected to enter into force by the end of 2020.

How will that new idea work? In theory, it combines the idea of using security tokens with a classical initial public offering. Because of the character of the institution which initiates this process, IDO will need to meet all standards common to the traditional stock exchange. And because of this, it will be far better protected than standard ICO or STO – at least that’s what its developers claim.

But what’s the purpose of introducing such an idea by SIX Group? According to its top executive, Tomas Kindler, it’s an attempt to create a digitalizes market for its clients. As he said in the talk with CoinDesk:

“We are looking at our clients to invest, but at the same time commit business and help us validate what we built and get it off the ground. The key focus is not money; it’s money linked to business and validation of the business model.”

New ideas are still ahead

That’s all for the fundraising schemes in the crypto industry – at least for now. New ideas for the offerings presented in this article are an excellent example that the blockchain world is vastly developing. And we can’t be sure exactly what new approaches to that topic will look like.

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