An Initial Exchange Offering (IEO) is a token sale organized with the help of an exchange platform, in which the startup pays a listing fee and shares a percentage of the tokens sold to the exchange. This strategy is beneficial for both exchanges and startups since all IEOs need to be screened and inspected before publication in order to avoid scammers. Also, the security is increased since the exchange is handling the KYC (Know Your Customer) and AML (Anti-Money Laundering) processes, and the contributors have to sign up on the exchange’s website. As the exchange funds the advertising campaign, the possibility of success of the project is increased since the exchange is more experienced than the startups. Once the IEO is over, the listing of the crypto coin on the exchange platform is a natural process, making the whole process much more efficient.
The steps for participating in an IEO is comparatively simple. First, Check crypto exchange websites for lists of ongoing IEOs, then sign up for an account and complete the KYC procedure. Secondly, do some research about the IEO, and fund the account with the cryptocurrencies accepted by the project. Last, buy the tokens.