Are ICOs the Future of Funding for Startups?
Blockchain startups investment upsurge scenario developed in 2016. Though, ICOs - blockchain based platforms got more recognition in 2017 because of the amount of capital raised. Hire ICO experts if you are planning your next blockchain project funding.
Data research by Coin Desk clearly shows that the era of ICOs’ will prolong and there is no ambiguity. Just consider the fact that in Q1 of 2018, $6.3 billion had raised. And this is equivalent to 118% of the total amount raised last year.
If you are searching for the biggest trend in cryptocurrencies today, you may find initial coin offerings (ICO) ideally in your search list. This is possibly the good start. Idea of selling tokens in exchange for cryptocurrency made way for the ICOs.
First you should know what an ICO is and how it matches with your business ideology. ICO is a fundraising platform for blockchain projects especially working well for startups with budget and time constraints.
Are ICOs offering democratization of fundraising in today’s world?Yes. Through smart contracts, they are implementing transparent rules between sender and receiver. Also, there are different types of tokens serving different purposes. For instance, if an ICO sets utility tokens that means company services or products you can exchange after certain period of time. There are also equity and security tokens but again it all depends on the end-goal of the ICO.
Since 2013 ICOs are used for funding new cryptocurrencies. Tokens are used for selling and trading cryptocurrencies if there is demand for them.
ICOs Surpassing Venture Capital FundingDo ICOs help in quick and easy acquisition of funds or will they won’t last long and it’s just another hype? Fact of the matter is startup funding has changed with time. Startups are now raising money at impeccable speed by timely utilizing ICOs. Unlike VC (Venture Capital) where startups has to go through long time taking legal proceedings, ICOs are way too easy for reaching and save investments through smart contracts. First three months of this year are clear indication that ICOs have superseded VC way of raising funds.
With that much of hype, startups feel excited for considering ICO for their funding campaigns. ICOs are good in a way that if it crosses the soft cap of the set token sale, it shows an indication that investors can rely on that ICO for their upcoming sales. However, do check the ICO team profiles if you are an investor before putting your cryptocurrency at risk.