Are you a crypto trader looking to invest in new projects? Or are you a developer? Want to raise funds from the crypto market for your project? With the number of fundraising tools available in the market, it is difficult for both investors and startups to choose the one that best suits their needs. On one hand, investors explore those options. Where the chances of fraud are less while on the other hand startups try to explore alternatives with fewer procedural requirements. So that they can raise funds for their project. Choosing the best option seems a daunting task for both those who want to earn. And those who want to launch. Projects involving cryptocurrency and blockchain technology mainly raise funds using three popular methods of ICO or IEOS and STOs.

<span style="font-weight: 400">Oops! You might be thinking what is an ICO or IEOS and STOs? Let us try to explain and compare three widespread methods so that you can assess them before taking their advantages.</span>
<h2><strong>What Is An ICO(</strong><strong>Initial Coin Offering)</strong><strong>?</strong></h2>
<span style="font-weight: 400">If you are a crypto enthusiast, you might know about ICO. But newbies, are you wondering what is an ICO? An Initial Coin Offering or Initial Currency Offering (ICO) is a crowd fundraising tool specially meant for <a href="https://www.cryptoknowmics.com/news/list-of-top-blockchain-development-companies-to-watchout-for-in-2020/">blockchain startups</a>. Startups issue coins or crypto tokens in crypto marketplaces to raise funds which are usually exchanged with crypto coins. Any individual or organization can become an investor by having a sufficient number of Bitcoins and Ether in any project.</span>

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<img class="aligncenter wp-image-167372 size-full" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2020/04/What-is-ICO.png" alt="IEOS and STOs" width="800" height="492" />

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How does ICO work? Firstly, before launching the ICO, the project developers or teams want to raise funds. Issue a document called a white paper. In which the objective of their project, essential details of the team, mission, and vision of the same should be clarified. This should also be highlighted. Benefits for investors.

Then, initially, the coins are given to investors interested in the project in exchange for crypto coins (usually BTC and ETH). If the project becomes legit, the coins get listed on an exchange. Opens doors for business. But the risk is real in the present scenario. Because many projects are short-lived and meant to dupe investors. But, if you research the project carefully. So you can invest in a real working project and make huge profits. There are currently many websites like Icobench, Coincodex, Coinschedule, Cryptoslate, etc. available to help you choose from several ICOs.
<h2><strong>What Is A Security Token Offering (STO)?</strong></h2>
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<img class="aligncenter wp-image-167417 size-full" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2020/04/What-is-STO.png" alt="What is IEOS and STOs" width="800" height="492" />

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<span style="font-weight: 400">If you are exploring the options to invest in a new project, you may have encountered STO. Did you search for what is STO or Security Token Offering? Similar to ICO, STO is also a fundraising method in the crypto marketplace. In the case of STO, cryptocurrency or token representing a security contract is offered to investors. Security is a kind of investment product (which can be stocks, bonds, funds, or Real Estate Investment Trusts(REITs) backed by the assets of the real world. Thus, the security token signifies the information of ownership of the investment product recorded on the blockchain. </span>

<span style="font-weight: 400">There is a significant <a href="https://www.cryptoknowmics.com/news/difference-between-coins-and-tokens/">difference between tokens and coins </a>issued in ICO or IEOS and STOs respectively. The coin is not backed by underlying assets while the token is fungible and backed by the assets of the real world of the company, thereby less likely to be involved in faking the projects. Also, some of the sites like STO Check, STO market, STO analytics, etc, are committed to providing the best overview of the reliable STOs all across the world.</span>
<h2><strong>What Is An Initial Exchange Offering (IEO)?</strong></h2>
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<img class="aligncenter wp-image-167418 size-full" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2020/04/What-is-IEO.png" alt="What is IEOS and STOs" width="800" height="492" />

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<span style="font-weight: 400">So here we respond- What is IEO for our investors, which they might be expecting us after ICO or IEOS and STOs. An Initial Exchange Offering or IEO is defined by the exchange's platform on behalf of the startups who are looking up to raise the funds for their project with their newly issued coins. The token sale is conducted on the <a href="https://www.cryptoknowmics.com/news/popular-cryptocurrency-exchanges/">platform of a cryptocurrency exchange</a> after the token issuer pays the listing fees along with a percentage of tokens that are needed to be sold. Issuers have to create accounts on the exchange and investors fund the exchange wallets with coins to purchase the newly issued tokens. Various platforms are available to conduct CEOs like Binance Launchpad, Huobi Prime, OKEx Jumpstart, Coineal Launchpad, and many more.</span>
<h2><strong>Which One To Choose To Invest/Raise Funds?</strong></h2>
<span style="font-weight: 400">Is it the battle of ICO vs STO or IEO vs ICO or ICO vs IEO vs ICO or IEOS and STOs? As in the real world, different people have different requirements, similarly, their choices depend on the kind of investment that suits them best. We can only give you insights into all three methods, but final choices need to be made by you only.</span>

<img class="aligncenter wp-image-167430 size-full" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2020/04/Which-one-is-better-ICO-IEO-and-STO.png" alt="ICO, IEOS and STOs" width="800" height="492" />

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<h3><strong>Review Of Pros And Cons Of ICO</strong></h3>
<ul>
 	<li style="font-weight: 400"><span style="font-weight: 400">Initial requirements of setting up of whitepaper of the project, a website informing the details, and a technical support team are easy to fulfill before issuing ICO.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Low funds are needed for investment (even newbies can try their hand!).</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">No barrier to the entry of both buyers and sellers.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">The distribution process of tokens is simple and automated.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Susceptible for scams as anybody can design the ICO with the help of easily available standards in the market like that of ERC20.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Not preferable for long-term investments.</span></li>
</ul>
<h3><strong>Review Of Pros And Cons Of STO</strong></h3>
<ul>
 	<li style="font-weight: 400"><span style="font-weight: 400">Compliance with government rules and backing up with real assets, STOs are considered trustworthy tools for investment.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Secured investment tool due to the limited accessibility given to the recognized investors.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Long-term investment tool.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">High fundraising costs and complex processes are involved in issuing STO.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Low liquidity due to heavier government regulations.</span></li>
</ul>
<h3><strong>Review Of Pros And Cons Of IEO</strong></h3>
<ul>
 	<li style="font-weight: 400"><span style="font-weight: 400">Highly secured as the exchanges are mostly KYC/AML verified.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">The protection of investors is insured by the exchange platform conducting IEO.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Familiar process for investors who already know about the trading process on crypto exchanges.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Issuers might be charged highly by exchanges, thereby expensive process of issuing IEO.</span></li>
 	<li style="font-weight: 400"><span style="font-weight: 400">Investors have little control over the activities of the exchange.</span></li>
</ul>
<h2><strong>Summing Up</strong></h2>
<span style="font-weight: 400">We might conclude that none of them is completely flawless or they are complete flaws. It depends on the <a href="https://www.cryptoknowmics.com/news/list-of-famous-bitcoin-investors/">needs of investors</a> and the issuer while choosing the fundraising tool.</span>
<ul>
 	<li><span style="font-weight: 400">If an investor believes in the idea of decentralization (many do) and wants short-term and inexpensive investments and fundraisers are not mature enough to fulfill several compliances before starting raising the funds; then they end up choosing ICO.</span></li>
 	<li><span style="font-weight: 400">If an investor is ready to invest a huge amount and prefers the traditional structure of investing and the issuer is ready to follow the stricter regulations of the authorities; then they might end up choosing IEOS and STOs.</span></li>
 	<li><span style="font-weight: 400">If an investor believes in the credibility of a <a href="https://www.cryptoknowmics.com/news/what-are-the-zero-fee-trading-cryptocurrency-exchange-platforms-in-india/">particular crypto exchange</a> and wanted to choose a safer source for their investments and the issuer wanted to utilize the popularity of the exchange and doesn't mind spending the listing fees; then they might end up with IEO.</span></li>
</ul>
<span style="font-weight: 400">Thus, in the end, if you are an investor, it's your money, choose judiciously to invest it. And if you are an issuer, then choose wisely which option best suits your needs!!</span>

&nbsp;

<strong>Articles You May Read</strong>

&nbsp;
<ul>
 	<li><a href="https://www.cryptoknowmics.com/news/ico-vs-ipo/">ICO vs IPO | Simplified Guide For The Beginners Of 2020</a></li>
 	<li><a href="https://www.cryptoknowmics.com/news/guide-for-cryptocurrency-scams/">Guide For Cryptocurrency Scams | How To Find If A Company Is A Scam?</a></li>
 	<li><a href="https://www.cryptoknowmics.com/news/how-to-buy-cryptocurrency-on-binance/">Guide On How Do You Trade On Binance Exchange</a></li>
</ul>

All you Need to Know about ICOs, IEOS, and STOs

What is an ICO or IEOS and STOs? This comparison guide will try to provide you with a brief insight into the three most popular fundraising tools.

Tarulika is an engineering graduate and an eloquent crypto blogger. Being a digital economy supporter, she keeps herself updated with the latest innovation in the crypto industry, Blockchain Technology, Internet of Things and other technologies. Currently, she curates the simple and interesting content for Crypto guides for beginners. If you want to learn more about the cryptocurrencies, latest trends of blockchain-powered AI applications, you are free to follow her on LinkedIn and Twitter.

All you Need to Know about ICOs, IEOS, and STOs

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