The Impacts of IEOs on the crypto-ecosystem

[nlaara12]

You have done a great analysis on IEO,I agree with you because that is the truth,it is just difficult for so many greedy set of people to admit it.We share the same sentiment, i also created a post on it.

[futile-resistance]

I think that IEO is an interesting option but does not changes that fact that many new projects simply don't have innovative and concrete ideas, that's the main problem that most project have and I really hope that some good project will come out so that investors can really come back to this market.

Well, yeah that is true. If you do not have potential in a project, IEO will not be conducted. It is always the vetted assessment of the exchange that your project will have to pass through and only then you can avail the benefits of IEO. It ensures safety when it comes to investors putting in funds. I think that IEO will benefit the crypto enthusiast more.

I believe into exchange operators to take care of checking the potentials of projects. If they will be failing in this, then IEO will face the same fate of what ICO had faced in the times of 2018. I guess, everything will go smooth and perfect now as we are in the early days of IEO.

[zgrdyg]

IEO bring money to dried up ICO system.

But is that good for crypto-ecosystem? One of the biggest problem we were facing that money was pouring icos which worth nothing actually. And that seems to be over and now they can still get money thanks to IEO's but is that a good thing?

[nikogluttonym]

It will take time and there will be a project that did not fulfill its promises or were fraudulent. And the exchanges will start to lose their face.

[cribusen]

For sure exchanges have an interest in holding an IEO. I have absolutely no doubts that all this stuff is paid by projects. Because holding an IEO on Binance guarantees its listing and a sold out. And when only listing costs 5 million USD I cannot image the IEO price that the project is paying.

[universal3ee]

IEO which in full means initial exchange offering is not a new topic in the crypto eco-system. Long before Binance Launchpad, several projects have taken that path to raise funds for there project by offering the native currency of their platform to traders on exchange. I remember observing a few on mercatox some years back. It was definitely no big deal as at that. Today IEO has become a menacing rave in the crypto-space owing to the fact that majority of the ICO in time past have failed to list on reputable exchange for investors. regardless of the hype and uniqueness of a project,  securing reputable exchange with good trade volume is key to the liquidity of digital assets and sad to say it today's crypto investors don't want to wait for products. They rather sell the hype than wait for the long term yield that will accompany this project gaining real-life application.
The impact of this IEO model proposes three debilitating factors on the blockchain community.

1. Lack of widespread distribution of nodes and monopolization of the. Today's IEO model literally plays into the hands of whales. With the likes of bittrex favoring high purchase by a single user. It's not hard to see whales controlling the valuation of these upcoming projects cryptocurrency on exchange. Asides from prices, centralization of nodes can be dangerous as it can lead to treats on the network with respect to mining. A Single-user acquiring a subset of the network can be catastrophic.

2. The IEO mechanism does not truly favor long term growth of this project. Now it's important to note that the majority of these coins sold on exchange are bought not by investors but by traders who actively trade on exchange. Majority of this traders do not no a thing about this project and will dump at the slightest profit or in the face of the slightest loss. Some might say it's part of the market cycle. Weak hands selling to stronger traders but it's key to note that community is very important in crypto compared to other market and it's almost impossible to build suck around traders who do not care or look towards the success of this project.

3. This exchange is also doing too little to protect the interest of participants who take part in these IEOs. In my opinion, it shouldn't just be about raising funds and meeting Hardcaps. These exchange should take up more roles. Some examples I picked up from the Pledgecamp project concept includes. Strategic disbursements of funds raised during these IEO events based on achievements of milestones, certification and other pre-agreed terms all design to ensure this project doesn't just bail off with people's money or fail to develop products that can attract value to the native currency.

In conclusion, a lot more tinkering needs to be done in order for IEOs to continue to flourish and promote the growth of the blockchain community. If steps aren't taken to prevent these impacts, we might see the IEO trend failing just like the majority of ICOs have failed.

Well firstly i find that IEO is a new innovative way in crypto space. However there is always pro and cons on any new idea, i believe the cons that is explain by you can be quite true but recently i heard from my friends is that they are able to make some profits from IEO at the moment though.

[GospelCrypto2]

I am in support with majority of the points raised in this thread, but i will like to ask, in what ways can a single user owning a large portion of the supply of a cryptocurrency affect the blockchain network?..

Unlike other system,  cryptocurrency and blockchain technology proposes a decentralised system in which data is distributed across the nodes in order to maintain the immutability and integrity of the system but in a situation whereby one single entity controls so much of the nodes,  security is no more guaranteed, data can then be doctored and that will spell doom for such projects..

[GospelCrypto2]

IEO bring money to dried up ICO system.

But is that good for crypto-ecosystem? One of the biggest problem we were facing that money was pouring icos which worth nothing actually. And that seems to be over and now they can still get money thanks to IEO's but is that a good thing?

The renewed interest by investors is definitely good but just like the post pointed out there are some inherent issues that need to be tackled unless more harm will be done than good on the long run

[Lagduf]

It will take time and there will be a project that did not fulfill its promises or were fraudulent. And the exchanges will start to lose their face.

That's why the exchanges need to seriously take the credibility and reliability of a project developers into account. By helding an IEO the exchanges is also betting their name for it. If the projects are to scam people the exchanges will have the impact too. I guess all those exchanges are already know this and is already have a handful of solution.

[FanEagle]

I think, IEO does not bring sustainable development for Cryptocurrency, It's just a games of whale, exchanges ... Most people who participate in this game will be badly damaged.

The concept of IEO is actually a good one and would go a very long way in sanitizing the system of crowd funding using blockchain technology if managed very well, but unfortunately too, in the planet we find ourselves, human being would always take advantage and misuse an opportunity that would have left a great positive mark in the crypto world.

I agree with you that it can be hijacked by whales which exchanges themselves too might end up being the whales since they have access to the larger portion of the token, the intention of the initiator might not actually be for this but has the system gained wide recognition, the whales may have seen the loop holes too and taken advantage of it. That is why we need an exchange that will do their business with integrity; this is the only way out.

[avonka]

Agree on many of your concerns but the main benefit from IEOs is that they are filtering out scam projects which caused the biggest problems to the ICO market and for the investors.. Without regulation on ICOs this is an advanced solution ( ICO 2.0 ) of course still not perfect one.

[Coin_trader]

IEO helps company that wanted to be included in cryptocurrencies or to have their own crypto line much effective in sense that they will be listed already in exchanges. Its a one step advantage than running an ICO.

[btc-facebook]

The best effect of having this IEO offering is pushing our investors back to try again to play buy and sell. Since the market turns in red everything get collapsing. Investors decrease day by day and the good things made by IEO was showing that world of investment is still alive.

Ofcourse the world of investment is still alive, but the problem of this IEO is there's still so many problem regarding the sale, problem of the site right after IEO started caused by too many participants attempt to buy and the site become overloaded. There's also so many people using script and bot to participate, just like on Kucoin Spotlight, it's so unfair.

[dataispower]

IEO which in full means initial exchange offering is not a new topic in the crypto eco-system. Long before Binance Launchpad, several projects have taken that path to raise funds for there project by offering the native currency of their platform to traders on exchange. I remember observing a few on mercatox some years back. It was definitely no big deal as at that. Today IEO has become a menacing rave in the crypto-space owing to the fact that majority of the ICO in time past have failed to list on reputable exchange for investors. regardless of the hype and uniqueness of a project,  securing reputable exchange with good trade volume is key to the liquidity of digital assets and sad to say it today's crypto investors don't want to wait for products. They rather sell the hype than wait for the long term yield that will accompany this project gaining real-life application.
The impact of this IEO model proposes three debilitating factors on the blockchain community.

1. Lack of widespread distribution of nodes and monopolization of the. Today's IEO model literally plays into the hands of whales. With the likes of bittrex favoring high purchase by a single user. It's not hard to see whales controlling the valuation of these upcoming projects cryptocurrency on exchange. Asides from prices, centralization of nodes can be dangerous as it can lead to treats on the network with respect to mining. A Single-user acquiring a subset of the network can be catastrophic.

2. The IEO mechanism does not truly favor long term growth of this project. Now it's important to note that the majority of these coins sold on exchange are bought not by investors but by traders who actively trade on exchange. Majority of this traders do not no a thing about this project and will dump at the slightest profit or in the face of the slightest loss. Some might say it's part of the market cycle. Weak hands selling to stronger traders but it's key to note that community is very important in crypto compared to other market and it's almost impossible to build suck around traders who do not care or look towards the success of this project.

3. This exchange is also doing too little to protect the interest of participants who take part in these IEOs. In my opinion, it shouldn't just be about raising funds and meeting Hardcaps. These exchange should take up more roles. Some examples I picked up from the Pledgecamp project concept includes. Strategic disbursements of funds raised during these IEO events based on achievements of milestones, certification and other pre-agreed terms all design to ensure this project doesn't just bail off with people's money or fail to develop products that can attract value to the native currency.

In conclusion, a lot more tinkering needs to be done in order for IEOs to continue to flourish and promote the growth of the blockchain community. If steps aren't taken to prevent these impacts, we might see the IEO trend failing just like the majority of ICOs have failed.

Although IEO is guaranteed by exchanges, the risk from the IEO is still huge. Don't think the IEO will help you x your account many times. If the exchange does not have a separate coin, they will not pump the IEO. That is a waste. Look at bittrex as a bad example.

[L A R A]

Although IEO is guaranteed by exchanges, the risk from the IEO is still huge. Don't think the IEO will help you x your account many times. If the exchange does not have a separate coin, they will not pump the IEO. That is a waste. Look at bittrex as a bad example.

I agree with you, IEO has a big risk, especially nowadays more IEOs are implemented in large exchanges but the tokens are not clear, we should also need to be careful when choosing IEO projects

[nicster551]

The best effect of having this IEO offering is pushing our investors back to try again to play buy and sell. Since the market turns in red everything get collapsing. Investors decrease day by day and the good things made by IEO was showing that world of investment is still alive.

I agree, thats the best thing that IEO can help in the crypto space. Investors are back investing in some projects again and we can see that the market is recovering. But the thing I dont like about this IEO are there are some shitty projects that still become successful because of the hype on IEOs.

[jvper]

There have been many kinds of evolution. From the first ICOs with reputable escrows (do you remember that?) to IEOs, it is an ever changing world.

[Kencha77]

Very well said mate. I think IEO investments are still quite a risk and still should be avoided for the fact that most large investors have larger parts in the coin distribution. Even if it's a promising coin with a listing after the sale. The dump is always there to pull you and makes you a large loss.

[alonelyorange]

Last one week almost five IEO was success with sold out just few time, we don't know how many IEO will be success at the future and will be bring big effect for ICO become lower interested and scam later.

[Mrsparks]

Very well said mate. I think IEO investments are still quite a risk and still should be avoided for the fact that most large investors have larger parts in the coin distribution. Even if it's a promising coin with a listing after the sale. The dump is always there to pull you and makes you a large loss.

I agree with this completely. IEOs are more or less whales puppet. Check out that of Bitrex, veriblock to be precise, it performed terribly on listing , I can assume two things. (1) Either majority of ythe coins where purchased by the exchange (2) The developers bought their coins themselves and dumped immediately on unsuspecting traders.