A type of fundraiser in which a company sells a new cryptocurrency is known as an initial coin offering (ICO). In exchange for their financial contributions, investors receive cryptocurrency. In many ways, an ICO is the cryptocurrency equivalent of a stock exchange initial public offering (IPO) While ICOs have the potential to make a lot of money, their lack of regulation makes them extremely dangerous. ICOs are a quick and efficient way for start-ups to raise capital. If you can figure out which cryptocurrency is a good investment, you can make a lot of money. What if you had an idea for a new cryptocurrency system that you could fundraise for without giving up any ownership in your business? Let’s call it DenCoin for the time being. The only issue is that you need people’s money to create the currency. Then there comes the initial coin offering. Here’s how it works. You create a document outlining exactly how the system would function (typically referred to as a white paper), design a nice website, and explain why it’s a great idea that could be very useful. Then you ask people to send you money (usually Bitcoin or Ether, but you can also accept fiat) in exchange for DenCoin – they hope that DenCoin will be widely used and in high circulation, increasing the currency’s value. How do initial coin offerings (ICOs) work? When a company decides to hold an ICO, the date, rules, and purchasing procedure are announced ahead of time...
