ICO, also referred to as an initial coin offering, is a crowdfunding model that is based upon the cryptocurrencies to help the startups and entrepreneurs in raising capital funds for their business and its growth. The entire process of raising funds through the investors, gets done by implementing smart contracts, tokens, along with the proper white paper launch. In ICO startups, there is a great role of investors as they are the ones who invest their funds in the projects and help the businesses to lead towards growth. Similarly, the ICO is also beneficial for the investor. Yes, it is a vice versa process. Considering the same and in order to help you in understanding the benefits of ICO for an investor, we have started the details here. Let’s get started.
Benefits of issuing an ICO to an investor
Offering a new product to the customers and raising funds for it through an ICO proves to be an easy and faster source for investors. There are some major advantages and benefits of an ICO for an investor. These advantages encourage the investors to invest their money in the initial coin offering. To know about such benefits, just have a look at below given points:
Liquidity
Usually, when people look for new investment options, then they usually feel the liquidity factor missing. In several opportunities, the capital gets inaccessible for several years. However, initial coin offering, the investors will have high liquidity, and also the real-time pricing will be based on the current value of the project.
Decentralization
It will be available for everyone. The major factor is that the money is decentralized and is not controlled by a single body rather it can be accessed by everyone and anyone can see the changes done in the project.
Openness
Along with the investors, the contributors can also invest in ICO anytime. As compared to the traditional models of funding startups; the whole process is quite different. In traditional startups, it becomes quite difficult to become an early investor if you are not having any close contacts with the founders. But I see the situation is quite different. In order to become an early investor, the contributors just need to pay attention to the upcoming ICO and purchase the tokens soon after it gets launched.
Variation in cost
tokens of a project can vary from project to project and vale to value. This increases the chances of earning profits and reduces great risks and liability. Also, the ability of the investors to invest makes many new startups successful and thus benefits the investors to use the ICO funds any time.
Lower competition
There exist many new startups or projects which struggle a lifetime to attract funds and investment through traditional methods. This occurs more in case they do not have a strong reason to appeal to the customers. This can be the lack of proper location such as projects based on any center out of the city, type of offering, especially in non-profit organizations and many more. More the procedure is simple to invest; more is the funds available for the project. This only requires having complete knowledge about the competitors and their way of funding in the tokens. This gives a clear picture of the competition already prevailing in the market for the ICO project you are focusing upon.
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