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Author Topic: Launching an ICO on an Exchange Versus Independently  (Read 162 times)
Coinve.st
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November 04, 2017, 04:34:55 PM
 #1

Similar to IPO's and stock launching on the stock market, why don't we require ICO's to launch on exchanges instead?  In that way, it would:
-  Help reduce risk (and reduces scams) for the investor
-  Be a more seemless purchasing process for the investor buying from an exchange (versus from the company)
-  Ensure that the investor obtains tokens immediately
-  Requires the startup to work and obtain a partnership with the Exchange prior to launching
-  Enables users to sell their positions if needed (instead of holding coins and waiting weeks for the startup to get listed on an exchange or lose them to a scam)
-  Enables the market (instead of the company) to determine and set the market cap AND price based upon demand

It seems like it would be easy to accomplish this logistically as well.  The startup would have to work in advance to secure a partnership with a reputable exchange.  From there, develop an agreement together to make available or transfer X amount of coins / tokens to the exchange for it to trade.  Both would then set an ICO date and the asset would be open for the public to trade.

Are we missing an opportunity here?

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November 04, 2017, 04:42:01 PM
 #2

That would be like polishing a turd; which is why exchanges probably, mostly ignore ICOs. Why would they give their name to centralized scamcoins with no substance? They have actual, decentralized, transparent and fair cryptocurrencies to deal with.

It would just give a false sense of security for non-suspecting crypto-noobs while they would be still ICO-scams with centralized funds and control belonging to the "devs".
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November 04, 2017, 04:45:55 PM
 #3

That would be like polishing a turd; which is why exchanges probably, mostly ignore ICOs. Why would they give their name to centralized scamcoins with no substance? They have actual, decentralized, transparent and fair cryptocurrencies to deal with.

It would just give a false sense of security for non-suspecting crypto-noobs while they would be still ICO-scams with centralized funds and control belonging to the "devs".


I'm sorry buy your response makese no sense.  Huh  These are the same companies that are eventually being listed on Exchanges anyways.  Where do you think the current companies listed on exchanges started?  They all held their own independent ICO.

What I'm asking / proposing is that we merge the process to make it more difficult for ICO's to just launch independently, help protect the community, and fairly price companies (instead of allowing the companies to control that).

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November 04, 2017, 05:33:43 PM
 #4

Why would you introduce another middleman?

You know, those centralized crypto exchanges have proven to be not that reliable. By adding an exchange, you are adding more risk rather then reducing it.

- Token distribution can be programmed into a smart contract. It's technically possible to create tokens before the sale, on the fly, some ICOs prefer to wait until they have raised a target amount or even wait until the end of the sale. It's a business decision, not a technical restriction.
- There is no simpler way then depositing funds and getting tokens in return.
- Centralized exchanges will require a fee for their services.
- Tokens can trade immediately on decentralized exchanges using the contract address.
- If you want to invest in a business with a working product, you do your own due diligence instead of delegating that to a 3rd party. If it turns out the business has no product, you can choose not to invest. You don't need to pay an exchange to tell you that.

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November 04, 2017, 05:34:11 PM
 #5

Similar to IPO's and stock launching on the stock market, why don't we require ICO's to launch on exchanges instead?  In that way, it would:
-  Help reduce risk (and reduces scams) for the investor
-  Be a more seemless purchasing process for the investor buying from an exchange (versus from the company)
-  Ensure that the investor obtains tokens immediately
-  Requires the startup to work and obtain a partnership with the Exchange prior to launching
-  Enables the market (instead of the company) to determine and set the market cap AND price based upon demand
- No it doesn't help to reduce risk at all as there are many unregulated exchanges out there which will list any coin for ICO after paying certain fee.
- Buying tokens through ethereum is much more easier and you will have coins instantly.
- No during ICOs most of the exchange doesn't enables deposit/withdraw of the coin.
- Getting listed on trading platform is not hard at all if you have good money to pay listing fee.
- That doesn't add up and I don't think any exchange will spend days figuring all those amount out.

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Coinve.st
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November 04, 2017, 06:00:05 PM
 #6

Why would you introduce another middleman?

You know, those centralized crypto exchanges have proven to be not that reliable. By adding an exchange, you are adding more risk rather then reducing it.

- Token distribution can be programmed into a smart contract. It's technically possible to create tokens before the sale, on the fly, some ICOs prefer to wait until they have raised a target amount or even wait until the end of the sale. It's a business decision, not a technical restriction.
- There is no simpler way then depositing funds and getting tokens in return.
- Centralized exchanges will require a fee for their services.
- Tokens can trade immediately on decentralized exchanges using the contract address.
- If you want to invest in a business with a working product, you do your own due diligence instead of delegating that to a 3rd party. If it turns out the business has no product, you can choose not to invest. You don't need to pay an exchange to tell you that.

I personally would want to purchase coins through Bittrex or Coinbase and allowing the marketing to set the price (based upon normal demand / supply economics) than relying on an untrusted startup and allowing them to set their price and marketcap.

Reputable exchanges like those can't be paid and would add some credibility as well. 

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November 04, 2017, 06:18:29 PM
 #7

I can't argue with your personal preferences.

I can only advise you to look up what happened to many centralized exchanges in the past. It was only 2 weeks ago that Bittrex closed accounts without explanation. NovaExchange has just announced their closure. All Chinese exchanges were forbidden from trading and listing ICO tokens in September, shortly before the complete ban of cryptocurrencies. Poloniex stopped answering support tickets a few months ago. I don't think I have to tell you about eBTC and Mt. Gox.

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November 04, 2017, 06:32:22 PM
 #8

But eventually you will have to trade your coins you purchased on an exchange anyways?  So why not do it during the initial ICO process.  Again, to allow the market to set the price of the COIN versus allowing the startup to do that?

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November 04, 2017, 07:03:45 PM
 #9

That would be like polishing a turd; which is why exchanges probably, mostly ignore ICOs. Why would they give their name to centralized scamcoins with no substance? They have actual, decentralized, transparent and fair cryptocurrencies to deal with.

It would just give a false sense of security for non-suspecting crypto-noobs while they would be still ICO-scams with centralized funds and control belonging to the "devs".


I'm sorry buy your response makese no sense.  Huh  These are the same companies that are eventually being listed on Exchanges anyways.  Where do you think the current companies listed on exchanges started?  They all held their own independent ICO.

What I'm asking / proposing is that we merge the process to make it more difficult for ICO's to just launch independently, help protect the community, and fairly price companies (instead of allowing the companies to control that).

I'm saying big exchanges should keep ignoring ICOs as they do (though there are some curious examples of crap being listed) because virtually every ICO project and startups doesn't know what they're doing. They're gambling with other people's money instead of their own and using the coattail of Bitcoin to lure in and skin newbies.

Why should established exchanges help them do it even easier and also give their names to scams? The bigger exchanges tend to ignore heavily premined coins and ICOs are just that.

Also, some projects eventually getting listed shouldn't be a reason to open the floodgates and to support all kinds of unprofessional projects and straight up scams. Despite this forum is flooded to the brim with ICOs and airdrops, ICOs are not the norm. They're blatant cashgrabs ignoring what crypto is created for and caused by the huge influx of people looking for the next gold rush (that isn't there) after seeing Bitcoin's success. ICOs are rotten from the core as currencies because of the nature of the initial coin centralization and unfair distribution and lack of transparency. Starting them on exchanges doesn't change that.
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November 04, 2017, 08:08:27 PM
 #10

I agree with you.  But that's my point.  Instead of having 200 independent shit ICO's every month, this slight change in process could help reduce and only promote the top 10 legimate projects that deserve to be traded.  Similar to the stock market, not every company that wants to be on the stock market is approved for an IPO.

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November 04, 2017, 09:52:46 PM
 #11

Do those exchanges even have the expertise to tell good ICOs apart from bad ICOs?

And wouldn't there be a massive conflict of interest? Look at the listing fees exchanges ask for simple coins. Now imagine if they become the ICO gatekeepers.

"Want our Seal of Approval? For the right price it's yours."

Oh, but the big exchanges are putting their reputation on the line.

"At Big Exchange, we strive to offer world-class ICOs that deliver the best experience possible to our customers. With the launch of our new ICO last week, we fell short on this commitment. We are extremely sorry for the frustration this has caused our customers and we are doing everything we can to make ICOs better."

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November 05, 2017, 02:13:10 AM
 #12

Sure.  There isn't a perfect model or solution here.  But I do believe that it would be a better solution than what we are experiencing today.  It's obvious that there has been more scam and bad projects than good projects.  And as a result, it's slowing the growth of this industry.

BTW, I don't mind people putting their reputation on the line here.  We need more of this.  More credibility to help protect the community.

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November 05, 2017, 02:17:55 AM
 #13

Only small exchange do this such as Yobit...
All other major exchanges they will never deal with directly offer ICO because it's take risk for their brands. And it maybe actions from Gov to against them if some ICO turn to scam!
So this is impossible.
In the past Bittrex also host some ICO such as LGD so it's still room for trust ICO deal directly with big exchange

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November 05, 2017, 12:12:56 PM
 #14

The idea to check ICO startups is not that bad, I just don't trust exchanges either.

There are ICO gatekeeper projects, you could say blockchain based Kickstarter clones.

Some examples: funderbeam, coincrowd, kickico, weifund.surge.sh, fundyourselfnow, cofound.it, fundrequest.io, starbase.co, comsa.io.

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November 05, 2017, 05:09:06 PM
 #15

I remember Bittrex used to host and launch ICO's.  Does anyone remember how those went and why they stopped?

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