Good morning my fellow Steemians. Glad to be here this week again. Here below is my Home Work Task for this week.
"Question 1: Explain in your personal opinion whether IDO should be done on Cryptocurrency."
From my own point of view, IDO should be carried out on Cryptocurrency because of the mechanism and other processes involved. It is a new faster and fair way of introducing a coin or token into the market (crypto space) as well as raising funds, using decentralized liquidity exchange.
When a new project is launched by a community, IDO gives them the opportunity to create awareness of this new token to the general public or it could be on already existing tokens. Participants are allowed to swap their tokens through the exchange (DEX) with the ones that carry out IDO.
IDO is a crowdfunding strategy, because if a small project is launched, many are permitted to take part, thus as the participants I creased, more fund will be realised within a short time frame. Like the Universal Market Access (UMA) protocol. When it launched it's token (UMA) through DEX Uniswap with an opening price of $0.26 per token. To get on this price, they supplied $535,000 Ethereum into a newly created liquidity pool. As a result of the IDO event strategy, the token price increases to more than $2 just in few minutes after the launch. This and other examples show that IDO greatly aid in fund raising as well as putting the tokens in the hands of many.
Also note that the Cryptocurrency used can be ordi ary coins or stable coins in order to make this project easier and encourages more participation.
"Question 2: Can IDO have a significant impact on the cryptocurrebcy world?"
Yet, it can have a huge impact on the crpgo space. As we know that IDO is a successor of ICO and IEO, there are characteristics that set it apart from other events. They are:
The Venue: IDO uses DEX as a result, it removes the third party, influencers, hackers and human errors. Also, the venue makes it possible to use peer-to- peer (P2P) way of transaction.
Currency Type: It uses tokens instead of coins at the opening price. This will help to create awareness on the token.
Wallet Used: Due to the use of cold wallet, which is the offline wallet that stores the user's address and private keys, hence protecting it from an unauthorised user, cyber hackers and others. This wallet used (cold wallet), really create a very noticeable impact on crypto world
Exchange Fee: unlike other events like IEO that recieves exchange fees from participants, IDO do not charge exchange fees during the event.
There are other advantages that help IDO to have great effect in the crypto world. They include:
-Transparency: Blockchain network system IDO uses, gives the users or participants the opportunity to check out every activities directly on the token purchase contract. Meaning there is no hidden agenda.
Liquidity: Projects that are carried out IDO event with DEX are being controlled, therefore, they do not allow their participants to participate in IDO on other DEX platforms. This makes the token to be more liquid, as they (participants) will not sell their token quickly. Thus, there will be more of this token and one can get it faster.
Flexibility: It is a flexible because all the token that carried out IDO do not hesitate to list this tokens on DEX platform, where the IDO event was done. This listing aids the investors that hold these tokens to trade their tokens from the previous event.
With the above reasons, IDO is trying to solve the problem of it's successors (ICO, IEO, etc) as more awareness is being made on IDO, thus its impact will be seen and embraced by all in the Cryptocurrency world.
"Question 3: Explain one example of a token that has been IDO but failed/rug pull."
One example is Raven Protocol. This event was launched in 2019 on Binance DEX, being the first on IDO project, had the objective of assisting in fast trading, immediate liquidity and open and fair crowdfunding. However, from the investor's point of view, the token was sold within few seconds, leaving the average investors or traders no chance to get hold of tokens.
Hence, that aim of fair distribution failed. So the objective was not reached and this even led to the creation of IDO launchpads.
"Question 4: Make a detailed fundamental analysis of 2 tokens that have done IDO, and compare the two tokens. Then give your opinion on the results of your analysis."
As an IDO project, it's token UMA on Ethereum blockchain system is a collateral-backed tokens. This token was sold through DEX Uniswap with an initial price of $0.26 per token. In order to get that price, they supplied $535,000 into the Ethereum liquidity pool.
The token price actually increased, because of the mechanism on Uniswap. This attracted a good number of investors that were even tempted to pay higher gas costs. As a result, UMA's token price skyrocketed more than $2 within just few minutes after the lau ch, although it at last stabilized at above $1.
Inspire of the initial drawback from Uniswap, it has a market capitalization worth over $1.5 billion, with a token going for more than $25
This was launched in 2019, it was he first project from IDO. The token is RAVEN.
Date of launch: from 17 june at 09:00UTC to 18 June at 09:00UTC.
Total hard cap: $500,000
Total supply: 10,000,000,000
For sale: 4,000,000,000 (40%)
Public sale: 300,000,000 (3% of total supply) IDO protocol.
Sales target: $500k
Raven token really had a lot of investors. The IDO event brought a great light to the Raven token. It created awareness of the token, actually a crowdfunding event. Although some countries were not allowed to participate, yet many investors got this token. Raven IDO event had an edge over UMA.
I feel that IDO project is an event that bring a lot more of improvements on Cryptocurrency world and many will em race it as it will enhance Cryptocurrency trades.
"Question 5: Look for 1 token that is currently IDO and explain the steps to be able to participate in the IDO."
TeraBlock is a token that is presently on IDO event and was launched on the 11th of May, 2021. It is a personalized automated trading.
Steps to be able to participate
- Stake 1,000 tokens (Bronze)
- Buy crypto with a bank debit or credit card. The crypto will transferred or credited to your account.
- The technology will help to manage your trading, even to the point of reinvesting your profits.
- Open a Binance trade wallet which is secured and there is no management fee charged.
- You need to join their telegram community.
Subscribe to their news letter.
Join their other social media platforms like Twitter, Facebook, etc.
"Question 6: Conclusion."
From the above analysis and explanation, IDO is an event that is new in the crypto world, but come with alot of benefits , unlike the previous events like ICO, etc. It introduces new tokens to the general public as well generate funds quickly for projects. Also it enhances trading.
Thanks for allowing me to participate.