IEO is currently the most popular fundraising trend in the crypto industry. As the name suggests, Initial Exchange Offering is conducted over the crypto trading platform and exchanges. So unlike ICOs wherein crypto projects directly approach investors, IEOs involve a third-party in the form of crypto exchanges.
An IEO is basically an ICO except that it is launched and managed by an existing exchange instead of the organization that created the token. The exchange holds and sells the token on behalf of the project team.
A new group of investors is therefore forced to register and use the exchange platform.
Many of the top exchanges who are Launch Initial Exchange offering ( IEOs) have different requirements that involve holding or using their own platform tokens in order to participate in the IEO. By creating this condition, exchanges create demand for their internal tokens, which increases its value.
The project team needs to meet and comply with the exchange’s platform requirements (due diligence) to initiate token sales
The first crypto exchange was the Binance exchange launching its “Launchpad” platform.