Initial Coin Offerings (ICOs)

Abstract

This chapter looks at the whole landscape involving initial coin offerings (ICOs) beginning with their history, how they came into being, selling of pre-mined tokens, the advantage and disadvantages of investing through ICOs, and issues related to regulation and scams surrounding this new crowdfunding approach. The primary objective of investors to buy tokens through ICOs is to invest money on the potential of a future product. The purpose of arranging an ICO is to raise money for a future project selling its pre-mined tokens to investors. The success of the Ethereum ICO made it possible to generate funds from the initial coin offerings for the development of blockchain projects by releasing some or all of the native tokens. According to the ICO Watch List, the network and telecommunication industry attracted the most significant sum raised by ICOs. The successful launch of the Ethereum platform encouraged other projects to raise capital using ICOs.