Initial Exchange Offerings are gaining popularity as an efficient way of crowdfunding. IEOs seem to be rectifying all the shortcomings witnessed with Initial Coin Offerings. Experts predict that we might witness an IEO boom just like ICOs during the 2017/18 period. Generally, an IEO is the same crowdfunding process as an ICO. However, unlike ICOs, the crowdfunding is done on a cryptocurrency exchange. Additionally, ICOs are open to everyone but IEOs are exclusively available to exchange customers.
With the cryptocurrency sector realizing the benefits of IEOs, some exchanges have come up with platforms to support this initiative. In this guide, we look at the best exchanges for IEOs.
Binance is a leading cryptocurrency exchange with a good reputation in the market. Recently, the exchange launched its own IEO offering platform called the Binance Launchpad. Within 2019, the platform has facilitated two successful projects. At the start, the exchange hosted IEOs for Bread and Gifto. However, the game changed when the platform hosted the BitTorrent token sale by TRON. In all measures, the IEO was a huge success. During the period, Binance even suffered some technical difficulties due to a high number of traders.
After the success of the BitTorrent sale, Binance carried out token sales Fetch.AI and Celer Network. Just like BitTorrent, the two sales were also successful. With this success, the Binance Launchpad has become popular even with a few drawbacks. The platform has a reputation for limited token supply, longer waitlists, and fast token sales. Despite the drawbacks, Binance position as a reputable IEO home has not been damaged in any way.
Based on the growing popularity of the launchpad, Binance has been forced to alter its sales model to focus on high demands. Previously, tokens were sold on the first come basis, but now interested investors are subjected to a lottery system. This approach has brought some fairness in the game.
At the moment, Binance is the most influential IEO launchpad. Many experts believe that the platform will set the pace for an IEO boom similar to the ICO frenzy of 2017/18. To participate in the Binance Launchpad sales, all you to do is create an account with the exchange and select the Binance Launchpad button. For more on the launchpad visit our review of the Binance Launchpad here. Binance success has not gone unnoticed as other exchanges have also joined the bandwagon.
Bibox is a leading cryptocurrency exchange that has also ventured into IEOs with a platform called “Bibox Orbit”. While announcing the launch, Bibox stated that it aims to offer the base for the development of high-quality decentralized projects. The Bibox exchange offers traders secure and cost-effective trading services. The platform is available on desktop, Mac, Android and iOS with a friendly user interface. The exchange also deals with more than 150 trading pairs alongside leading coins like Bitcoin, Ethereum and Bitcoin Cash.
According to Bibox, Bibox Orbit is a product resulting from years accumulated experience supported by a qualified team. It aims to provide a platform for constructing long-term blockchain products. To take part in the purchase of Bibox Orbit sale there are simplified rules for all users. The team aims to provide a safe environment for all clients by conducting lottery systems. The platform has also put in place a limit of personal pre-purchase amount for all users.
Bibox conducts draws where all pre-purchase amount is divided equally. Note that to take part you need to hold the native Bibox Token (BIX). The lottery is conducted according to the proportion of the users’ total pre-purchase amount and the actual issuing amount by project teams. For security purposes, all users on the platform undergo the Know Your Customer process alongside Name Authentication.
Bibox states that we already have applications by different global projects seeking to fundraise on the platform. By the time of writing, the platform had four projects. We have the Force Protocol that offers crypto finance solutions for the global asset lending market. The Ludos projects assist developers and game studios to crowdfund development. We also have a STAKING project with a complex system of infrastructure. The project allows investors to stake their assets without worrying about security concerns. Lastly, we have the X-Block project that enables access to enterprises to access more service resources at reduced costs.
Bibox selects projects based on team members, project application scenarios, community engagement, white paper, project investors among other parameters.
KuCoin is another leading exchange that has the kucoin Spotlight for IEOs. Since joining the market, Kucoin’s mission has been around spotting and nurturing progressive blockchain projects. The kucoin Spotlight platform is for blockchain projects to raise funds, gain popularity and grow. According to Kucoin developers, the crypto market is volatile and lack of regulations has led to scams exhibited by ICOs. This calls for the need to have IEO launchpads.
To enroll a project on the Kucoin Project, owners have to undergo a strict vetting process. Part of the process entails hand picking promising projects vetting them alongside the developer team. Once on the platform, the projects are continuously monitored to ensure nothing fishy happens. Generally, the management of Kucoin reserves the right to admit and expel crypto coins from their Spotlight platform. Screening is, therefore, largely internal and the procedures vary from one potential blockchain project to another. The first project on KuCoinSpotlight was MultiVAC, a technology firm that seeks to develop a fully sharded blockchain.
Traders have to undergo a straightforward process if they want to take part in token sales. All you have to do is create an account with KuCoin before accessing KuCoin Spotlight. Ensure the exchange operates in your country and identity verification requirements are in order. More importantly, you need to sign the purchase agreement and have adequate KCS in your account.
With the growing buzz around IEOs, the negative reputation left behind by scammy ICO projects might be a thing of the past. Since exchanges don’t want to damage their reputation, we might see some healthy competition in the IEO sector. This aspect will result in more investors coming on board. When established firms like Binance are keen on supporting new projects we might see the entry of institutional investors into the crypto sector. For years, the lack of these investors has remained one of the reasons why we have a slow adoption rate of cryptocurrencies.
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