The prevailing situation of confusion about the authenticity of blockchain projects has enticed technology enthusiasts to take control of the matter and to develop their own financing model to drive the introduction of decentralization.

This need to bring a new class of investors on board. Initial Coin Offering (ICOs) a model that turned out to be a great success in the last few years as the financing rounds now reached new heights.

At the end of 2017 and from 2018, the ICOs had reached a peak point. In 2019, we saw new types of blockchain funding models, IEO, in the industry that promises to help blockchain entrepreneurs and investors get more confident in the decentralization world.

Financial Scope for Decentralization

ICOs initially involves the initiation of financing through the blockchain ecosystem. The model, which mainly works based on white papers, invites investors to put their money into the decentralized project for the return of crypto coins.

The second quarter of 2019 showed the growing popularity of the IEO, which has replaced the dated model of the ICO. The new trend, whose main role is the examination of cryptocurrency exchange projects and the organization of token sales, has established itself positively among enterprises and start-ups.

With blockchain continuing to grow as the primary source of technical innovation, it is not surprising that IEOs have become synonymous with fundraising for blockchain-based projects. Tokens have proven to be a versatile form of fundraising and have created incentives for users to generate a steady flow of capital that is required to reach the next level of development.

Statistics from the crypto market show that over 65 IEOs have been launched in the past six months, of which around 40 have successfully achieved their soft or even hard cap. Remarkably, half of the projects are carried out that have already completed their IEOs. A total of 245 projects have conducted an IEO over the past three years and generated revenue of $3.4 billion.

Some established players like Wolfs Group OÜ, the European consulting company that specializes in various strategic industries investing and payment gateways, is already actively working on the market and the projects. The Wolfs Group team announced IEO at the start of 2020 of its WLF token on the Coinsbit cryptocurrency exchange.

The WLF token is based on the ERC20 standard and the Ethereum blockchain. This will ensure the wide availability of WLF and access to the largest crypto industry exchanges like Bitrex or Binance. The ERC20 standard is a broadly used standard that allows users to protect their funds through a token agreement.

Coinsbit is one of the largest cryptocurrency exchanges in the world, ranked 3rd in terms of volume by Coin market cap. Coinsbit is also considered one of the most trusted cryptocurrency exchanges, where 95% of users' money is kept in cold wallets.

As the crypto market continues to evolve, many projects are considering repeating their IEO rounds, especially if the previous one turns out to be successful. As in the case of the Wolfs Group, IEO will be held in 5 stages. The softcaps of each round will be $2 million, and the hardcaps will be $10 million.

What Does This Mean for Your Company?

While IEO is only slightly different from ICOs, the benefits that IEOs have to offer to appear to be very large in comparison.

• You don't have to ask your blockchain development agency to set up your KYC process, as the process is already being carried out by The Exchange
• You will receive the finished user base for the crypto exchange.
• Admission to the exchange requires a whole range of other specialist knowledge - a step that can be easily avoided.
• The fact that your project is listed on an exchange it automatically gets a trustworthy reputation.
• Investors will be able to quickly diversify their assets with the immediate sale of their tokens in the stock market.

Another significant benefit is the extensive due diligence that is carried out to thoroughly examine the project team's merits, their qualifications, a work plan to show their planned progress. Many other elements prevent wrong projects from potentially causing financial damage.

Inspired by the benefits of IEO, companies are looking for an effective way to adapt to the changing market. IEO has established itself as an all-in-one method for attracting investments, which meets security standards and serves as a reliable method for issuing, offering, and exchanging a token.

Conclusion

Quality exchanges can serve as a guarantee that IEO projects that are integrated into the exchange and published there offer investors something valuable. In contrast, projects can benefit from the extensive community and healthy liquidity provided by the exchange's trading infrastructure.

Companies are now looking to issue security tokens instead of issuing utility tokens. The blockchain market is also becoming more secure and stable now, as investors are opening for long-term projects.