If you have been following the evolution of how new crypto projects are crowdfunding then you will undoubtedly have heard the term IEO. The abbreviation stands for Initial Exchange Offering, and as the name implicates, it is the process of starting your token sale on a crypto exchange.
Table of Contents
- The great centralized exchange launchpad race.
- Why choose to launch an initial exchange offering (IEO)?
- Benefits of an Initial Decentralized Exchange Offering (IDEO) over an IEO?
- How to launch your own IDEO with Saturn Launchpad.
The Great Centralized Exchange Launchpad Race
Of course it did not take long for most major centralized exchanges to have latched onto this idea - I mean it has amazing business potential for them & gives their exchange token an extra usecase. They have all made up different sets of rules around needing to hold their exchange token to participate in an IEO and that, of course, holding more of their tokens gives you more benefits when choosing to participate. As is all too usual for these platforms it has simply became a race to chase down money by any means necessary and control another aspect of the industry.
They have all been busy launching whole platforms to support the process: Binance Launchpad, Bitmax Launchpad, Bittrex IEO, Huobi Prime, Kucoin Spotlight & Okex IEO are all on the way - though Binance appears to be winning the race with several successful token sales already to its name.
I only shudder to think of the potential market manipulation scenarios that are made possible by exchanges controlling how a large portion of a token's supply is distributed from day zero. Given these platforms are centralized they can easily: censor & filter who is allowed to buy the tokens, manipulate the token's price or manipulate the token sale completely much like how they create fake volume.
Investors seem to have fallen under the charm of the new IEO buzzword, with a naive belief these upstanding businesses will be auditing token sales and that their investments are safer on an exchange where they do not control their private key?
Do not get me wrong though, after having dealt with the marketing headaches around an ICO campaign, I can definitely see the appeal of why projects are choosing the route of an IEO.
Why choose to launch an initial exchange offering?
If you are having trouble to wrap your head around what an IEO is, then simply think of it as an ICO where the exchange acts as a guarantor and venue for the project's token sale.
- It allows developers to take advantage of the exchange's existing user base, which should see people participating in their crowdfund immediately.
- Investors are reassured that the asset will be listed & tradeable on an exchange.
- Cryptocurrency exchanges are being monitored by various price aggregating websites, which in turn becomes free marketing for a project's token sale.
- No matter how you put the flow together, sending funds to a smart contract address or QR code will always worry a potential investor. There have just been too many ICO scams, however, accessing your token sale via an exchange interface removes this stress.
- A project's tokens have already been minted and are visible on the exchange platform, whereas, with certain ICOs you just had to trust you would one day receive your tokens.
It definitely brings various advantages to your token sale that cannot be overlooked and everyone can understand. Now, what if we removed the negatives we have discussed caused by a centralized exchange, and used Saturn Launchpad platform? This allows projects to set up and launch their token sale via an initial decentralized exchange offering (IDEO).
Benefits of an Initial Decentralized Exchange Offering (IDEO) over an IEO
Given that many token sales happen on Ethereum, using a censorship resistant decentralized exchange such as Saturn Network for your IEO is an ideal solution.
- Equality - Saturn's exchange architecture is truly decentralized as the orderbook operates entirely on chain & it is governed by DAO. This means there are no risks of any manipulation happening due to the exchange's own greed - it would not be possible.
- Free to use - We do not believe in creating gatekeepers and blockades to entering blockchain, such as the excessive fees Binance charges for using its launchpad service. We do not want to stifle ideas, Saturn Launchpad allows any team to start innovating on equal footing.
- Accessible to all - It also allows anyone to access and participate in your token sale without the need to create an account or submit to an exhausting KYC process - they simply need to know how to use an Ethereum dApp browser such as MetaMask, Saturn Wallet, Enjin, Trust or more.
- Shared Ownership - as Saturn implements a shared ownership model where exchange profits are distributed among Saturn DAO members. If you buy SATURN tokens, your project can enter a unique position where you raise development funds through your token sale's IEO on Saturn & also receive a percentage of your participants paid trade fees.
At the end of the day, participants in your token sale are buying your tokens & investing in your projects because they believe in your idea and its success. It seems only fair that you would receive a share of the exchange profits generated by your token sale!
How to launch your own IDEO via Saturn Launchpad
- Decide your initial token price, remember that unlike a centralized launchpad platform there will be no restrictions: participants will be able to buy up as many tokens as they wish. We recommend splitting your token sale into multiple sessions, which can have a different price and different supply.
- Follow our guide on how to use Saturn Launchpad published on our forum. If you get stuck or need any help, reach out on our forum, we will be happy to assist you.
- Once you have provided all of your project's details, and we have confirmed your pull request then your token sale will be visible on our Launchpad page which you can start to provide to your community.
- Investors will need to be comfortable using a dApp browser to access your token sale. There a many options to choose from that support our exchange, so you should make sure your followers are aware and are given enough time to install their preferred wallet.
- A great way to make crypto investors aware of your upcoming IDEO is the advertise it on ICO calendar sites, you can find a full list of calendar sites here.
- Our exchange is currently listed on various cryptocurrency price aggregator sites such as Coinpaprika, Coingecko, Blockfolio, and Delta. Make sure you fill in their request forms for your token to be included.
- Use our media kit to highlight your token sale and Saturn listing on your website & various social media channels. Feel free to follow & tag our own accounts, we will surely share the news!
- Start a bounty campaign on our forum & use Saturn's Airdrop Tool to set up an airdrop on our platform, this will help you increase awareness about your token sale.
Congrats! You have just launched your initial decentralized exchange offering (IDEO) on Saturn Launchpad. If you need any help or have any queries, come join our forum and ask away!
Happy investing, happy trading & happy token sale.
Future is bright!