The pace of the crypto world is quadrupling, and its decentralised nature makes it flexible for anyone to launch their tokens easily. Usually, the crypto tokens go public after fundraising activities. As a crypto-preneur, you might have come across multifarious fundraising models such as IPO, ICO, STO, and IEO. The list further gets deployed by the addition of novel fundraising model IDO – Initial Dex Offering. This brand-new model in the era of decentralised ecosystem gives a golden opportunity for the development of your decentralised exchange platform. This blog exclusively speaks about right from its concept to use cases and a plethora of services that we offer in IDO.
What Is Initial Dex Offering (IDO)?
Before getting into the concept of IDO, it is mandatory to know the difference between a regular decentralised exchange and a liquidity exchange. The former is a one-of-a-kind exchange that depends on an order book to pair the makers and takers. The primary drawback is that it may result in high slippage and doesn’t guarantee instant liquidity. In order to jounce off this struggle, a decentralised liquidity exchange was introduced. It entirely relies on liquidity pools, which allows traders to swap tokens readily. This is where IDO comes into the picture.
IDO is a fundraising model, Initial Dex Offering (IDO) is a fundraising model, which facilitates the quick raising of funds for your decentralised exchange platform. The assets in the DEX platform will be in the form of either cryptocurrencies or tokens. To be more precise, you might be well aware of the conventional prototype where startups seek for venture capitals to fund their projects. Similarly, IDO lends financial support from the individual investors with the only difference that investors will not possess any equity in the project. It aids you in making accurate judgements and makes the community actively participate in your product/services. The first-ever IDO model launched was Raven Protocol. It was listed in Binance decentralised exchange in June 2019.
How Does IDO Stand Unique Between ICO, IEO, & STO?
When taking ICO (Initial Coin Offering) into consideration, it is the issuers who take charge of entire responsibilities. While in IEO (Initial Exchange Offering), it is done by a centralized exchange authority. By looking deep into both these models, it is evident that IDO is a blend of both ICO and IEO with a major difference that IDO is for a decentralized exchange.
IDO and IEX are quite similar fundraising models, with a difference that IEX involves using centralized exchanges. With CEX, tokens shall not be listed with the competing exchanges. It gives a lesser number of tokens in bulk to the exchange. While in IDO, it is entirely for decentralised exchanges that offer instant liquidity. No restrictions for DEX and no governing bodies involved.
When taking STO (Security Token Offering) into consideration, the security token supports the investment contract and adheres to the government regulations. While in IDO, the standards and regulations are about to be framed.
Benefits Of IDO
It is no doubt that IDO is now the ideal choice for crypto investors and also for fundraisers. Let’s have a glance at the splendid features of Initial Dex Offering.
- Swift Trading: This fundraising model provides a faster trading facility. It benefits the investors to quickly buy the tokens and re-sell it at a much-increased price in the future.
- High Liquidity: One of the top-class benefits of such a fundraising model is that it bestows liquidity instantly, which would increase the token price.
- Open-Source Model: It allows anyone to organise as well as anyone to participate in the fundraising event. No permissions are required.
- Economical Price: On the effective use of a liquidity exchange for a project, it may cost an affordable gas fee to deploy the smart contract. It takes in-charge of both token assets and liquidity pool.
The Future Of Initial Dex Offering
Undoubtedly, IDO will transform to provide numerous opportunities for the launch of brand-new tokens. It addresses the deficiencies in ICO, STO and also IEO. By utilising this fundraising model, users needn’t require any authorisations to organise the events. By proper channelising, it eradicates the deviations in the token values and makes effective use of KYC verification. The investors could benefit more and command over the token sales. This makes it a fascinating option for featuring novel tokens in the crypto globe.
Assuredly, the Initial DEX Offering fundraising model is all set to bring in a magnificent change in the industry due to its robust features and benefits. It has commenced gaining the attraction of crypto enthusiasts and also stands splendid for the prosperity of new token projects.
We at Cryptocurrency Exchange Script lend our best for all your IDO essentials. We provide umpteen IDO services, which are comprehensively personalised according to your needs. It includes whitepaper services, strategies and blueprints, marketing services, token development services, blockchain integration, product launch support and much more. Our sound technical experts watch the market meticulously and update themselves with ingenious concepts so as to proffer you a unique range of services.