The world of crypto fundraising has evolved from ICOs (Initial Coin Offerings) to IEOs (Initial Exchange Offerings) and now IDOs (Initial DEX Offerings). While all three involve token sales to raise capital, their processes and benefits differ significantly.
ICO (2017 era boom) – Projects sold tokens directly to investors via their own websites. While this gave teams full control, it also led to many scams due to lack of regulation.
IEO – Introduced centralized exchanges as middlemen. The exchange handled KYC, marketing, and token distribution, but charged high fees and required projects to meet strict listing criteria.
IDO – Removes intermediaries entirely. Tokens are launched directly on decentralized exchanges using liquidity pools and smart contracts. Investors swap a base token (like ETH or BNB) for the project’s token instantly.
Key differences:
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Custody of funds – IDOs don’t require sending funds to a third party; everything is automated via smart contracts.
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Speed – IDOs can be launched in weeks, while IEOs require months of exchange negotiations.
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Cost – IDOs are cheaper since no centralized listing or marketing fees are mandatory.
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Community participation – IDOs allow fair access, reducing the risk of insider allocations.
In short, IDO development is the next generation of token fundraising, giving startups decentralized control while offering investors instant liquidity and trustless transactions.