What is Initial Token Offering (ITO)?
Let's find out Initial Token Offering (ITO) meaning, definition in crypto, what is Initial Token Offering (ITO), and all other detailed facts.
Initial Token Offering (ITO) describes a type of event whose main purpose is to raise funds for a cryptocurrency project.
ITOs and initial coin offerings (ICOs) are two terms that are often used interchangeably. While they’re similar, there are a few differences that set ITOs apart from ICOs.
Unlike ICOs where the crowdfunding process is aimed at cryptocurrencies, ITOs prioritize offering tokens that have intrinsic utility. For instance, investors receive access to a specific platform through a subscription where token holders are able to take advantage of exclusive features.
Essentially, ITOs have a lot more in common with tokenization than crowdfunding since coins are tokens are not the same. While both coins and tokens are part of the cryptocurrency bubble, tokens mostly operate on an existing blockchain based on the ERC-20 standard while coins operate on their own independent blockchains like Bitcoin, Ethereum, and XRP.
Initial coin offerings became a controversial topic after some projects turned out to be scams. Moreover, some of the projects that implemented ICOs crashed soon after launching. It’s slowly becoming less and less common in the cryptocurrency world.