How To Select the Right Crypto Crowdfunding Platform?
Tags: cryptocrowdfunding, ico, sto, ieo
Published: 2021-10-30 07:11:14

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In the current decade, blockchain technology has become very popular. Crypto coins are the digital currencies that run on the blockchain. Blockchain is a digital ledger where transactions take place. Using blockchain we can store and record data. These are the reasons for its popularity. Though cryptocurrency was introduced in the year 2009, it became very famous in the year 2020. People get to know about blockchain and its uses. Not only the transactions, using cryptocurrencies one can raise funds for their venture. This method of raising funds through crypto is known as crypto crowdfunding.

To move from the traditional methods of funding through IPO, people started choosing crypto crowdfunding. Through crowdfunding, you can raise funds for your needs. It acts as an effective tool for raising funds and you can raise your funds quickly and effectively. Most of the people started raising their funds through crypto crowdfunding.  There are massive benefits available in crypto crowdfunding. One can participate in crowdfunding through crypto crowdfunding platforms.

Come, let us see in detail about crypto crowdfunding and the types of crypto crowdfunding platforms.

<h2>What is Crypto Crowdfunding?</h2>

Generally, people raise funds by the traditional method of backing a company’s shares. This method of fundraising is known as IPO(Initial public offering). There are different types of traditional crowdfunding: Donations-based, equity-based, and rewards-based. In this method, people provide some investments or their shares to raise large funds for meeting their requirements. In this method, most people like artists, authors, startups, and philosophers have crowdfunded their projects.

The Crypto crowdfunding method is the same as traditional methods. Here instead of fiat currencies, cryptocurrencies are used for fundraising. By selling their newly created crypto tokens, people will raise funds. In a crypto crowdfunding platform, people should have an excellent idea and a defined period for raising funds. During crowdfunding, the startup will release a whitepaper that gives complete information and official documents about the project. After the Crowdfunding gets started the project owner can collect the contributions from the investors globally. If you wish to create a crypto token, then you can create in existing blockchains like Ethereum, Tron, Binance smart chain, and Waves to raise the required funds for your crypto crowdfunding platform.

If in case, the startup doesn’t meet the required funds for their crypto business. Then the collected amount of funds will automatically get refunded to the respective investors. If the fund gets raised above the expected level, then the startup will make ample profits. Because of these great features, people are showing more interest in creating a crypto token and raising funds. Thus there occurs a maximum demand for crypto crowdfunding platform development. 

<h2>Types of Crypto Crowdfunding Platforms</h2>

In the field of cryptocurrency, there are many <a href="https://www.icoclone.com/blog/crypto-crowdfunding-platform-development/">crypto crowdfunding platforms</a>. Here, I’ve listed the three main and popular crypto crowdfunding platforms which are prevailing in the crypto marketplace.

<h3>ICO (Initial Coin Offering)</h3>

Initial coin offering is the most popular method of crowdfunding in the crypto industry since 2017. ICO is also called a token sale platform for newly created tokens. These tokens are hosted on the blockchain. By creating a new crypto token with extraordinary features will effectively raise funds. While running an ICO, traders, investors, and individuals can buy tokens in exchange for any crypto coins like Bitcoin, Ethereum, or whatever it may be. In the ICO platform, there will be no interference from the government or any third parties.

In initial coin offering, anyone can visit the ICO platform and can read the documentation of the startup. If an investor is willing to participate in that ICO project, they should wait until the token sale. Then, the investor can raise funds and can get the tokens, coins, or services in return. People with innovative ideas on the project will first go with the ICO for raising funds quickly. Therefore, the people who wish to launch an ICO platform will choose the ICO script software from the reputed ICO development service provider from the industry.

<h4>Benefits of an ICO</h4>

<li>Any people can raise funds with a proper whitepaper and a good idea</li>
<li>Anyone can launch an ICO website and  the launching cost is low for an ICO</li>
<li>There is no need to be well-financed to start an ICO</li>
<li>ICO has high liquidity</li>
<li>Investors will have full power over their funds</li>
<li>No intervention of government or central authorities</li>

<h3>IEO (Initial exchange offering)</h3>

Initial exchange offering is also a popular method of crowdfunding in the crypto industry. It also acts as a module or a feature in the crypto trading platform. This type of module in IEO is named as IEO launchpad. When the ICO method is getting popular on one side. The IEO method has entered into the crypto marketplace as a new method. of crypto crowdfunding. Crypto experts say that IEO is the evolution of ICO. There is only one difference between ICO and IEO. ICO can be developed by any of the developers. But IEO can be carried out only on exchange platforms. 

IEO is a crowd sale platform where all the newly created utility tokens will be available for sale. In IEO, the whitepaper will be thoroughly checked, verified, and analyzed by the exchange’s technical team to avoid fake ICO token projects and token scams. After the verification is over, one can participate in IEO and can raise funds.

To participate in an IEO token sale, you should create your token with the help of a reputed token development service provider from the industry. Here both the token issuer and the exchange owner will get profited through IEO. In IEO, there will be no need for smart contracts, but the KYC account will be verified in the IEO crowdfunding platform.

<h4>Benefits of an IEO</h4>

<li>There will be no need to put additional efforts into raising funds</li>
<li>Tokens will be immediately listed in the exchange</li>
<li>There is no possibility of a scam</li>
<li>Requires only KYC/AML from the token issuers</li>

<h3>STO (Security token offering)</h3>

Security token offering was introduced into the crypto marketplace to replace the ICO method. STO is a robust crypto crowdfunding method for raising funds. In STO, the newly created security tokens only will take place. Security tokens can be created by backing any of the assets like shares, real estate, commodities, or some real-time assets. The investor’s whole information will be held by the security tokens. Before creating the security token, you need to consider SEC rules and guidelines and the local government’s regulations. Security token offering will reduce the risks of token issuers. So, if you wish to create a security token, then you can create using premium STO script software.

<h4>Benefits of an STO</h4>

<li>Security token offering is a more secured and trusted crowdfunding method in the crypto industry</li>
<li>Because of backing the real-world assets, so there is no possibility of occurring scams</li>
<li>STO is the most effective method for long-term investment.</li>

<h3>How to choose the perfect Crypto Crowdfunding Platform?</h3>

Crypto crowdfunding is a popular fundraising platform for millions of startups. Investors will raise funds and support your idea. So, choosing an ideal crypto crowdfunding platform will yield more income if one wishes to start a business. While choosing a crypto crowdfunding platform, the following said points should be considered.

Choosing the type of crypto fundraising method is very important for crowdfunding. As discussed earlier, there are three types of fundraising models available such as ICO, IEO, and STO. These three platforms have different features. If you are an initial startup and wish to raise basic funds for your business, then you can go with ICO. Here the contact will be only between you and the investor. But choosing the crypto crowdfunding platform may change according to your wish. If you need high security, STO can be preferred. So, you can choose any of the platforms based on your business requirements. 

<h3>Wrapping up</h3>
Crowdfunding is becoming more prevalent and most people wish to raise their funds independently through ICO. With the help of crypto crowdfunding, users have experienced high efficiency, accessibility, and security. Creating a blockchain-influenced crypto crowdfunding platform will yield a pretty penny in the future. If you wish to launch a crypto crowdfunding platform, choose the right one for your business and develop them instantly with high-features integrated script software. So, hire a team of well-skilled and experienced developers from the reputed <a href="https://www.icoclone.com/">crypto crowdfunding platform development service provider</a> from the industry and launch your crypto crowdfunding platform right now!!!