Welcome to another informative article of Crypto Jargon. Today I will explain the terms behind the following acronyms:
So, let’s start with the most well-known I guess – ICO. It’s been explained in a hundred videos already and you might have seen my video from a couple of years ago, so I’ll keep it short and sweet.
ICO stands for Initial Coin Offering and it’s a form of crowdfunding a crypto-related project at a pre-launch stage.
ICOs are frequently used by developers of a new crypto currency to raise capital.
Since the first Initial Coin Offering in 2013 by Mastercoin, ICO have become a very popular method for investors to obtain tokens at low prices. At the same time, they have also been used by many scammers for illicit funding of dubious or non-existent projects, which put pressure on many government bodies to set regulatory framework for ICOs in 2017. China, India and America are currently amongst the few governments that require KYC registration for participants in ICOs.
While 2017 was the year of ICOs (thousands were launched back then), 2019 is the year of IEOs – this stands for Initial Exchange Offering and it’s a crowdfunding similar to an ICO but which relies on having an exchange or a number of exchanges that function as a counter-party. Developers mint the project’s tokens and send them to the exchange, which will then sell the tokens to individual contributors. It is more convenient in the way that the tokens are received directly into the users accounts in that exchange and they can start trading them without the nuisance of having to remember which wallet they used when they placed their orders for the Initial Coin Offering and then having to claim them and move them into the exchange once they are listed, a process that could in some cases take months and be quite a challenge for those who are not very tech-savvy.
STO stands for Security Token Offering and it’s a step further into providing more security for the investors. Similar to an Initial Coin Offering (ICO), an investor is issued with tokens representing their investment but unlike an ICO, a Security Token Offering represents an investment contract with agreed minimum returns or a return of the invested amount upon failure to meet this agreed minimum.
IPO is the original term that this stem from – it stands for Initial Public Offering and the event in which a company “goes public” selling early shares of their business in exchange for funds. This term gave birth to the crypto-specific term ICO but the two have major differences. IPO is about selling shares with a price are determined by the profitability of the company and its expectancy for future performance while ICO is about selling tokens that do not represent equity, not shares from the company, their price is based purely on hope and speculation about potential future performance of that project.
Now, about IMO – this is not a term related to cryptocurrencies or investments in any way, but I thought it belongs to this list purely because of the spelling similarities.
It stands for In My Opinion and it’s widely used on social media and could be confused with an IPO, so I thought I’d insert it here just to be on the safe side.
Lastly, there’s a term that isn’t used very much, FreeCO – Unlike a traditional ICO where investors are required to send money before the project launches, in a FreeCo, you just have to register with the project, and you get some free coins. You only get to invest later when the project is up and running. You won’t really find many of these but it’s worth mentioning it, I guess.
These and many more terms are explained in my eBook “Crypto Jargon A-Z: definitions of crypto terminology” which is the most up-to-date publication of its kind. With over 700 terms, acronyms and trading slang, it contains everything related to cryptocurrencies and blockchain tech: a must-have guide for every crypto investor. It’s an Amazon bestseller and it’s available for Kindle here.
Go to http://www.ojjordan.com/cryptocorner and grab your digital copy today.
Other posts you might like:
Ways to Earn Crypto for Free in 2020
TOKEN SWAP |TOKEN BURN |EATER ADDRESS & VANITY ADDRESS : Explained
Soft Fork Vs Hard Fork and Other Types Of Forks Explained
DAPP |DAO |DAC |DAICO |DLT & DIF : Explained
🏆Exchanges I use for trading crypto:
Where I buy crypto:
►Changelly (good for instant coins swaps)(Global)
►Payeer (Europe, Asia, alternative to paypal)
►Coinbase (USA, EU, Africa) Get $10 worth of Bitcoin on your first $100 crypto purchase with this link: https://bit.ly/enter-coinbase
Where I store my crypto:
- Ledger Nano – the best hardware wallet (offline storage)
- Trezor – also one of the best wallets out there.
- Exodus – desktop wallet
- Coinomi – mobile phone wallet with instant coin swap feature
- Crypto.com – mobile wallet and exchange
2 thoughts on “ICO, IEO, STO, IPO & FREECO Explained”
Spot on with this write-up, I truly feel this web site needs a lot more attention. I’ll probably be returning to read more, thanks for the advice!