What's ICO in Cryptocurrency

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What's ICO

ICO (initial coin offering) is a way that projects that are new hope to raise funds though this process is usually done without regulation and the hope is that after this ICO they could raise funds or capital for their project with the hope of it succeeding after getting the much needed funds.

Initial coin coin offering known as ICO for short is a term used to refer to newer projects who in a bid to raise funds have to sell their tokens to investors who buy this token initially with the hope that the project will appreciate even more were it to be a success.

What Are The Advantages Of ICO

One good thing about this iniative is that it's a good way to encourage growth of a project as it involves capital raising for new and innovative project without the hassles faced in the traditional funding process they easily get capital through this ico process and this enables seamless growth of good project who might be facing financial challenges to kickstart.

And we might wonder if when we buy this coin during the ico period is it valid and can it be traded? Ofcourse the answer is yes, one advantage of this is that any tokens we purchase during it's ico process we can actually be able to trade it in any exchange so in essence ico tokens offers liquidity and for those who are able to enter this ico and participate in it, it serves as a good investment opportunity for everyone as it is open to everyone.

Since ICO is open to everyone to freely join in on the process this actually helps to bring about what we know as decentralized finance as it makes finance to be in a truly decentralized.

Some Drawbacks That Comes With ICO

Ico is not regulated, like I mentioned earlier it's an unregulated process raising funds in cryptocurrencies and since it isn't regulated it means there maybe restrictions on its acceptability in some regions as some may frown at it or even be suspicious as there isn't any regulation and since they are not regulated it becomes a perfect way for everyone to easily come out with their own token an initiate this ICO process with the nefarious purpose intent to scam people.

ICO could become a platform for dubious and fraudulent individuals to operate seamlessly and defraud people of their funds all in the name of fundraising for there project.

There isn't guarantee for the success of this ICO project as have been observed many of them actually fail which means all those who invested with the hope of the price appreciating over time with the success of the project will be hugely disappointed as all their hopes will be dashed when this project fails. And apart from that it's also highly speculative much like shitcoin as there is no real basis for believe that with a 100% degree of certainty our funds will be safe as no one can vouch for the legitimacy of any project.

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Conclusion

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Ofcourse I believe that we all should ensure before participating in any ico that we do it of our own accord after thorough research about the given project to avoid falling victim to scams as if we fail to do this it will be damaging to us.