Why Do We Develop Initial DEX Offering

Development of the Initial DEX Offering (IDO)

Initial DEX Offering Development, or IDO, is a brand-new, innovative type of decentralized, permission-free crowdfunding platform that is pioneering a brand-new way to raise capital in the cryptocurrency sector.

An IDO launch is the introduction of a coin or token via a decentralized liquidity exchange. This cryptocurrency asset exchange's liquidity pools allow users to trade tokens such as stable coins and crypto coins. USDT/ETH is one such liquidity pair.

IS THIS A BETTER MODEL FOR CRYPTO FUNDRAISING?

IDOs have largely replaced other cryptocurrency fundraising models, such as IEOs, STOs, and ICOs (IEOs). IDOs are an excellent choice for new initiatives and businesses. They are eager to introduce a token and gain immediate access to money. They provide better and faster liquidity at all price points due to their mechanics.

In contrast to the previously mentioned fundraising methods, IDOs are widely regarded as a fair way to launch a new cryptocurrency project by avoiding pre-mines, an issuance system that favors project founders over community members.

The first ICO was the Mastercoin one, which took place in July 2013. In the first 12 hours of a token sale in 2014, Ethereum raised 3,700 BTC, which was approximately $2.3 million at the time.

On April 17, 2019, Idax, BitForex, Bit-Z, and Bit-M launched the first IEO. According to a June 2019 statement, Raven Protocol will introduce the first-ever IDO, which will be listed on Binance DEX.

WHAT HAVE IDOS STARTED THAT WAS SUCCESSFUL?

Despite being the first to try it and even claiming in their blog that they had no idea what an IDO was because it hadn't yet been implemented, Raven Protocol is regarded as a successful project.

RAVEN PROTOCOL IDO

This distributed and decentralized deep learning training protocol employs deep neural networks. The Raven Protocol aims to transform the AI and machine learning industries, which are currently dominated by large corporations, by providing quick and inexpensive solutions that use blockchain. The native RAVEN token is used to compensate contributors for sharing their computing resources, whereas the utility token is used for AI training.

UNIVERSAL MARKET ACCESS PROTOCOL IDO FOR

Despite initial IDO issues, the Universal Market Access (UMA) protocol was successfully introduced. As a result, DeFi developers can now create fictitious assets—collateral-backed tokens with erratic values—on Ethereum. It launched its token sale on the decentralized exchange Uniswap in April of last year, with a starting price of $0.26 per token. To get that price, UMA had to deposit $535,000 in Ethereum into a newly formed liquidity pool.

However, Uniswap stands out because it prices tokens using a bonding curve rather than order books. As investors flocked to buy the UMA token, its value skyrocketed. due to traders paying more for gas in order to outbid one another The value of UMA's token increased by more than $2 within minutes of its launch. Some buyers complained that they paid more for their purchases than pre-sale investors. The price eventually stabilized at slightly more than $1. This, however, highlights the problem with Uniswap rather than UMA.

Despite this early setback, UMA has a market capitalization of more than $1.5 billion. A token costs more than $25.

SUSHISWAP IDO

SushiSwap, an Ethereum-based decentralized cryptocurrency exchange that competes with Uniswap to be the most well-known decentralized exchange, is another comparable case. SushiSwap users reportedly transferred over $1.14 billion in locked crypto assets from Uniswap to the SushiSwap platform in September of last year.

It's worth noting that the platform decided against holding an initial coin offering (ICO) for SushiSwap in order to reward liquidity providers (LP) on Uniswap by staking their LP tokens on SushiSwap. SUSHI tokens were given to users in exchange for their efforts. During the first two weeks of the platform, users who staked their Uniswap LP tokens on the initial protocol received 1,000 SUSHI tokens every Ethereum block, or roughly every 12 seconds.

DO IDOS EXIST AND WHY?

When ICOs and token sales became popular in 2017, raising an estimated $4.9 billion by the end of the year, many projects attempted to use the blockchain to solve problems. It is difficult to deny that ICOs have a number of issues, including being centralized and vulnerable. While many have succeeded, many more have failed. Other significant drawbacks of ICOs include discrimination against third parties, vulnerability to theft and human error, and a lack of privacy.

This new fundraising model attempts to address the issues with ICOs. Because IDOs are decentralized, they are opening up new opportunities for the cryptocurrency market. A blockchain product could be introduced. It goes beyond malicious third-party influencers by using IDO crowdfunding. Furthermore, it eliminates any issues with hackers and human error. Furthermore, holders and buyers of token coins are immediately secure in terms of their wallets and private keys.

ADVANTAGES OF AN IDO

An initial DEX offering development has several distinct advantages over initial exchange offerings (IEO) and initial coin offerings (ICO) (ICO).

Another thing to keep in mind is that, despite the growing acceptance of IDOs, centralized exchanges such as Binance or Coinbase continue to wield significant market power. Investors do not inquire about the timing of the upcoming IDO listing. They are currently interested in learning when Coinbase will list a specific coin. Naturally, as more people become acquainted with DEXs and DeFi in general, this will most likely change.

LET'S GO OVER A FEW OF THESE RIGHT NOW.

when an IEO or ICO is used to fund a project Before it can be listed, it must first pay the exchange's fees and wait for the exchange to approve the project. IDOs provide a completely decentralized service. Projects are not required to pay exorbitant fees or obtain approval from anyone.

Furthermore, active community members evaluate projects and tokens without waiting for an exchange, allowing for both small-scale projects and large-scale collaborations.

In contrast to IEOs and ICOs, which require a preliminary waiting period, IDOs provide immediate access to liquidity and trading. IDOs also help users work more efficiently by providing a single interface for a secure wallet and trading platform. To make things easier for users, IDOs may also support a variety of wallet types.

WHAT WILL IDOS BECOME IN THE FUTURE?

IDOs are the most recent method for distributing tokens to the general public for crypto projects. The same is true for ICOs, IEOs, and STOs; they all need to be improved. The UMA IDO exemplifies this. The lack of a control mechanism, on the other hand, results from a decentralized exchange with IDOs. As seen in ICOs, IEOs, and STOs, removing token price fluctuations or enforcing KYC requirements are critical fundraising controls to have.

Scalability was given top priority. Currently, only DeFi projects have raised funds through IDOs, but this does not preclude other cryptocurrency-related projects from doing the same. Naturally, for these projects to succeed, some current DeFi users must be interested in purchasing a project's token.

Why? Simply because learning to use DeFi platforms has a learning curve. It could be difficult for the average cryptocurrency trader. Another improvement would be to raise awareness and educate people about DeFi as the industry grows.

Cryptocurrencies aim to increase financial accessibility by decentralizing finance. IDOs are a step in the right direction. But who is to say whether a new project is a good idea or a bad idea? As a result, determining the value of a coin can be challenging.

IDOs have a promising future, but more training is required. Furthermore, the DeFi user base accounts for a very small portion of the overall crypto market. Although it is still a small industry, it is expanding rapidly.