Fundraising Models- A Detailed Walkthrough
For the past several years, the cryptocurrency field has been on an epic rise in the digital marketing world. The rapid emergence of cryptocurrency has given rise to many innovative decentralized applications and protocols. The development of fundraising mechanisms is one of those innovative introductions. The main reasons for introducing fundraising models are for uplifting the business ventures of small-scale business entities and startups. The popular fundraising models, we develop at Blockchain App Factory are Initial Coin Offering (ICO), Initial Dex Offering (IDO), Initial Liquidity Offering (ILO), Initial Farm Offering (IFO), and Initial Insurance Offering (IIO). All these fundraising models have distinct functionalities. The business models select these fundraising platforms depending on their requirements of the token sale.
Initial Coin Offering (ICO)
Initial Coin Offering is the first fundraising platform that was introduced in the crypto sphere. It is extremely beneficial for startups and small-scale businesses. The functionality of this type of fundraising platform is similar to an Initial Public Offering (IPO). In an ICO, the investors buy a minor part of the offering and receive a crypto token as a reward and that reward can be traded in a decentralized exchange for fiat money or held by the investor till its value increases.
Initial Dex Offering (IDO)
Initial Dex Offering is an innovative fundraising model that launches its crypto project into the decentralized liquidity pool. The digital assets that are represented in the liquidity pool can be cryptocurrencies or non-fungible tokens. The primary reason for the success of the IDO fundraising models is the efficient listing capabilities and elimination of exchange fee.
Initial Liquid Offering (ILO)
Initial liquidity Offering is the most preferred type of fundraising strategy for small-scale businesses and startups. The business models directly sell their crypto token in decentralized finance (DeFi) based exchanges. Since the crypto tokens are sold in an already existing decentralized exchange, it allows the investors to purchase these tokens at a low cost.
Initial Farm Offering (IFO)
Initial Farm Offering is a new type of fundraising models that is based on DEX platforms. The funds for the crypto projects are raised through Farm offering platforms. This fundraising strategy allows the investors to participate in pre-sales that are hosted via DEX platforms. Initial Farm Offering is beneficial to the users and the investors by encouraging them to participate in the liquidity pool.