After the last bull run and the raft of lawsuits that came out of the initial coin offering mania of 2017 and 2018, it was generally believed that ICOs were dead in the water.
A combination of regulatory scrutiny, especially in the U.S., spectacular pump-and-dump schemes and an overall flakiness not witnessed since the back-of-the-beermat ideas of the Dot.com boom appeared to have sealed the fate of ICOs.
Which was a shame. Because, despite the scams and hype, tokens are an innovative way to raise money.
Stylianos Kampakis, CEO of The Tesseract Academy, says fundraising for new projects was never easier than in those days.
“During the ICO era, it was easy to raise money, but obviously, regulation killed that. With IEO (Initial Exchange Offerings), maybe you still have to go through regulation and scrutiny, things like that.”
As Kampakis hints, a range of alternatives sprang up, including initial exchange offerings (IEOs) or token generation events and even more innovative three-letter acronyms, such as initial node offerings (INOs).
Some say a new ICO boom is coming.
Jamie Elkaleh, global relationships manager with crypto exchange Bitget, says that while the halving and Bitcoin ETFs have sparked bullish conditions, token-raising events are smaller than they used to be.
“Any organization that wants to fundraise through selling tokens can use transparency as a feature, and it doesn’t really matter what they call them — ICOs or token events — these are ways to engage with a community and raise money in a transparent fashion,” he says.
“The difference between 2021 and this bull market is that sums are smaller. Before, they might have raised in double or even triple digits; now it’s smaller, single-digit raises, so $4 million, not $40 [million],” he says.
Token fundraising methods: Crypto projects with airdrops
Newer forms of token raises differ in other important ways, too.
Many Web3 companies looking to raise money in 2024 are…
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