Academy Details

UNDERSTANDING INITIAL EXCHANGE OFFERING (IEO) ON NAIJACRYPTO

Posted on 2021-03-17 10:58:18

How has your crypto journey been so far? Are there terms that you are trying to understand? Here, we will be explaining what Initial Exchange Offering (IEO) is to you.

What is an IEO?

Initial Exchange Offering which is known as the IEO is an initial token sale arrangement, organized by a cryptocurrency exchange platform on behalf of the company that owns the token, it is a token sale before the token begins trading officially on the exchange.

An IEO is done to create awareness for an upcoming project and attract the interest of investors to raise capital for the project cause.

It is a fundraising event administered on a cryptocurrency exchange platform.

The exchange is expected to assess the project for its potentials and use case before going ahead to host the IEO. The exchange acts as an intermediary between the investor and the parties hoping to raise funds, the founders mint new tokens and send them to the exchange for funding. The exchange facilitates this funding, including terms of trade like capping individual contributions and having a fixed price per token.

Most projects now find it advantageous to raise funds through IEOs for reasons such as:

  1. Trust: When a project’s token is being listed on an exchange platform that is trusted by people, it leaves the investors with no suspicious questions concerning the project. Since it is being offered on a site they trust, it enables the project’s investors to have a good level of trust in the project and therefore would want to be a part. The responsibility now lies on the exchange to filter out projects with fraudulent intentions.
  2. Awareness: The amount of awareness that a company’s IEOs get when it is on an exchange is more effective than getting awareness via other means especially if the project does not have a high budget of advertising to reach its type of investors. Exchanges are partly responsible for marketing the IEO to its community of users.
  3. Know Your Customer (KYC) Verification: For every project, it is necessary to have the profile of whoever has provided a stake in the project by buying your tokens. With the exchange’s compulsory KYC verification, every user who chooses to purchase the token has already been verified on the website. This enables the company to have a record of investors in their projects.

Naijacrypto has created a platform on its exchange for companies and start-ups to raise funds for any specific project through Initial Exchange Offering and most importantly it is giving its users access to be partakers in projects of different purposes for the long-run.

Are you a company willing to raise funds for a project or a start-up trying to get investors for your business through IEOs? Here’s how to get started.

  1. Ensure you have an account on Naijacrypto by signing up on www.naijacrypto.com
  2. Complete your KYC verification. Every user is mandated to complete their KYC verification to enable access to all features on their account.
  3. Log in to the account, Locate Apply IEO under ‘other services on the top menu.

  1. Fill in every detail that is requested on the page. The details would enable Naijacrypto to properly access your company and also to contact you for further details needed.
  2. Submit Information.

The Naijacrypto user who will like to take part in an initial exchange offering (IEO) on Naijacrypto will need to:

  1. Set up an account with Naijacrypto on www.naijacrypto.com
  2. Complete the KYC verification process. This is compulsory for all users on the platform.
  3. Locate the IEO launchpad at the top menu under ‘Other services’ to see all the IEOs that are ongoing, completed, and upcoming. From the list of IEO on the Launchpad, all details of the IEO are given, including the terms of the upcoming IEO, the IEO price, the IEO start date, and the IEO end date.
  4.  Fund the account to be able to purchase the coins from the IEO launch.

 

We encourage everyone to do their own due diligence on the project. Familiarize yourself with the IEO and read more. Take the information collected here and use it as the starting point for investigating further before making any purchase.