ICO vs crowdfunding

[rjefferson]

ICO's are great, but the problem I see int he future is that there will be so many. Decentralized currency is great, but there has to be a few ICO's that become the standard.

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[craigpo]

ICO's crowdfund to exchange. You buy tokens from ICO's to be used and exchanged at a later date.

[lichao1395427]

ICO is different from crowdfunding or IPO.

Crowdfunding or IPOs are regulated by most countries which impose restrictions on who is allowed to fund or how much they are allowed to contribute.
ICO is unregulated. It was born to bypass the regulations. People can invest as much as they want. Everyone can raise money by issuing cryptocurrency. There is no need to have developed products. The only you need is ideas. And you can raise more money than Crowdfunding. Investors  often don’t have any right to the company. So there is no protection. It is often considered as a crowdsales (their products are coins. So for tax purpose, they will be taxed, proceeds from IPO are not taxed).

[Granxis]

The first Icos have done very well, no longer like the old icos,many of them just come out as frauds and then disappear now.

[jekjekman]

Could someone explain to me how ICO's are different from crowdfunding? Why would it be regulated differently?

Crowdfunding is the process of funding a project or idea by raising many small amounts of money from a large number of people usually by internet.

ICO is an unregulated way by which funds are raised for a new crypto currency venture. An Initial Coin Offering is used by developers to bypass the rigorous and regulated capital-raising for their desired project usually it is made by selling their token or coin's idea to the customer for a certain amount.

So itis safe to say that ICO is a type of crowdfunding.

[Lampaster]

Of course it's the same thing. With the exception of those projects which receive grant funding through crowdfunding. When investing in ICO each user has a hope that he will profit from the project. Other differences between ICO and crowdfunding I don't see.

[richjohn]

The main difference between ICOs and crowdfunding is regulations. ICO is unregulated way to raise funds whereas crowdfunding is regulated. This keeps ICO off from hassle and also leads to lots of scam. Most investors here in cryptocurrency sphere want ICO to be regulated as well. I feel ICOs will get regulated soon because of increase in number of scam attempts. Countries would either be banning ICOs or be regulating it in near future.

[karmakeddon]

Crowdfunding projects are usually projects where you do not expect a return of your investment as these are solely used to raise money to either release a new product.

ICOs however are treated as investment, as these usually will give out tokens or coins as a form of currency or a share. This is also the reason why it is heavily regulated in some areas.

[Manyara]

ICOs are for the cryptomarket mostly and have no restrictions. Anyone can invest however much they want, from any location on the planet. Crowdfunding is however regulated and there are people who cannot invest however much they believe in the project.

[MoonJeina]

There are two major differences which clearly differenciate crowdfunding from ICOs .  In ICOs , there is a generation and issuance of their own tokens and the developers take the help of other wallets such as ECR-20 wallets and waves wallets etc to access and trade their tokens . They basically have to promote their coins and also tend to take some donations in the name of pre-ICO . The value of the coin is not known to anyone before the ICO . It all depends up on the success of the ICO . Whereas , crowdfunding such as Indiegogo is a crowd of people raising funds collectively to get some mutual profit from a product. The value of the crowdfunding is known before hand and the investors have a pretty good idea of the outcomes.

[Kronos21]

Crowdfunding projects are usually projects where you do not expect a return of your investment as these are solely used to raise money to either release a new product.

ICOs however are treated as investment, as these usually will give out tokens or coins as a form of currency or a share. This is also the reason why it is heavily regulated in some areas.

Why Crowdfunding does not offer the teaching benefits? There are a variety of projects. But all of these projects have clear project documentation. There is a certain amount needed to run this project and there are specific percentages that will be distributed among the depositors. ICO is a similar project but totally outside the control of investors.

[stompix]

Crowdfunding projects are usually projects where you do not expect a return of your investment as these are solely used to raise money to either release a new product.

ICOs however are treated as investment, as these usually will give out tokens or coins as a form of currency or a share. This is also the reason why it is heavily regulated in some areas.

The term of ICO was just catchy as it resembles to IPO but it has almost nothing in common, mainly in the legal aspect.

ICOs means crowdfunding or better say,  it is one way of crowdfunding.
The most important thing ICO and crowdfunding have in common, is he fact that the tokens (or the project) may NOT exists at the end of the sale.

In an IPO there is a bid for shares of an already existing company or business how you want to name it.
In an ICO the bid if for tokens of arbitrary value which might not even be issued and certainly don't go through the SEC approval process.

There are two major differences which clearly differenciate crowdfunding from ICOs . ........ Whereas , crowdfunding such as Indiegogo is a crowd of people raising funds collectively to get some mutual profit from a product. The value of the crowdfunding is known before hand and the investors have a pretty good idea of the outcomes.

Yeah, people investing in tokens do that out of goodwill.
And you're mistaken about the second part.
Also add one thing. In most crowdfunding if the value is not reached the money are sent back , in ICO.....can I laugh?

[Ealex]

Could someone explain to me how ICO's are different from crowdfunding? Why would it be regulated differently?

Excerpt from: https://coins.newbium.com/post/3206-crowdfunding-vs-ico-confront-the-expert-legitimacy

One major difference between traditional methods of crowdfunding and ICO, is the market value. When a product is introduced on crowdfunding platforms like Indiegogo, investors and buyers aware of exactly what to expect when the product was complete.


            For example, when the smart Pebble start their crowdfunding campaign, the investor can immediately find out whether the product is worth the amount of money by comparing other people's products on the market.


            In contrast, almost impossible to predict the outcome of the ICO, especially if users are not fully aware of what they can expect. ICO itself is not based on market value in the real world, thus making it vulnerable to substantial under or overvaluation of assets.