New projects sell tokens to raise funds in several ways: ICOs, IEOs, and IDOs. The names differ by just one letter, but each reflects a different answer to the question of “who organizes the sale,” as well as a different stage in the history of the crypto industry.

$ETH ’s early development was funded by a public crowdfunding campaign in 2014. Current price: 1934.9 (24h -4%).

📌 ICO: Projects sell directly

An ICO (Initial Coin Offering) is when a project sells tokens directly to the public to raise funds for development. The Mastercoin sale, launched in July 2013, is often considered the earliest ICO.

In July 2014, Ethereum launched a public crowdfunding campaign, where participants used Bitcoin to buy ETH. The funds supported Ethereum’s early development.

Around 2017, ICOs took off. Many projects raised large sums with nothing more than a white paper, and quite a few later failed to deliver on their promises. The lesson “understand a project before getting involved” has been repeated throughout the industry ever since.

📌 IEO: Vetted by an exchange

An IEO (Initial Exchange Offering) is a token sale conducted through an exchange’s launch platform, with the exchange handling project selection and the sale. In early 2019, Binance Launchpad’s BitTorrent (BTT) sale sold out in less than 15 minutes, kicking off a wave of IEOs.

Exchange screening adds an extra layer of vetting, but it doesn’t mean a token’s price won’t fall after listing. You’re still responsible for the price risk of new tokens.

📌 IDO: On-chain sales

An IDO (Initial DEX Offering) is a token sale launched on a decentralized exchange or an on-chain launch platform, which users join directly with their wallets. It’s accessible and fast, but there’s less vetting, and more fake projects and phishing pages.

When participating in an IDO, always check the page and contract address before connecting your wallet or approving any permissions.

📌 No matter the format

Before participating in any token sale, it’s worth checking three things: who gets the tokens, when each party’s tokens unlock, and the size and intended use of the funds raised. Focusing only on hype and promotion can make it easy to overlook these key details.

Anyone who approaches you out of the blue to pitch “private sale allocations” or “insider prices” is often running a scam; legitimate sales are announced through public channels.

📌 A final note

ICO, IEO, and IDO differ only in how they’re organized. Changing the name doesn’t make the risks of a new token go away. Don’t rush into a purchase just because everyone around you is doing it.

If anything wasn’t clear, let me know in the comments.