What is an IDO? And what is the problem?
What is an IDO?
IDO is short for Initial DEX Offering. A new ICO variant marks the first crypto token offering from a project to a decentralized exchange (DEX).
Here, you lock your funds with a project in exchange for your native token that has not yet been released. After the token generation event, the project releases the tokens to the participants in their wallets. Along with that, the token is added to different liquidity pools on DEX, where users can exchange their tokens for other cryptocurrencies.
Why are IDOs popular?
IDOs are hosted on dedicated launch pads like UpLift DAO. While early-stage investing has long been the purview of private investors, IDOs also include retail investors. Pitching platforms give the public the opportunity to claim promising project tokens at lower prices before they hit the market.
The key goal is to get attention and gain traction for the project. For this reason, most tokens come with a low initial market capitalization. This translates into lucrative earnings for IDO participants, sometimes generating 10 to 100 times the price of IDO. If you’ve been wondering what’s wrong with IDOs, now you have the answer.
1. Metaverso
Tech giants like Google, Microsoft, and Meta are all vying to plant their flags in the metaverse. The industry is growing by leaps and bounds. Fortunately, not just on the centralized side of the world. The crypto-metaverse arena is growing at a rapid rate, fueled by cryptocurrencies, NFTs, and DAOs.
The Metaverse is touted as an immersive layer of the internet, sustainable with its own economy, jobs, infrastructure, shopping malls, and entertainment stations. According to a report published by Grayscale, the metaverse is likely to permeate every sector in some way in the next few years. The market opportunity is estimated at more than $1 billion in annual revenue.
Web3, being an integral part of the emerging metaverse, holds a wealth of opportunities for investors. The incredible growth of metaverse tokens like SAND, MANA, and AXS serves as a great example.
2. GameFi
GameFi took gaming to the next level with some incredible profit prospects. What was once a hobby has become a profession for many, thanks to the new flood of platforms, empowered by cutting-edge aesthetics, user experience, and incentivization mechanisms.
Revenue from virtual game worlds is estimated to grow from ~$180 billion in 2020 to ~$400 billion in 2025. GameFi fosters a new free-market economy that can have value in real life. Transactions within a blockchain play-to-win game are facilitated by crypto tokens, which can be sold on both centralized and decentralized crypto exchanges.
As a game grows and acquires new players, the demand for its tokens and NFTs increases to a level that is often out of reach for regular players with low starting capital. This is why you need to get into a game early on. IDOs are a great way to acquire GameFi project tokens at a discounted price.
NFT4Play, one of the most anticipated play-to-win games, recently launched its IDO on UpLift DAO, raising 200,000 BUSD.
3. NFT Markets
That brings us to our next hot sector: NFT markets. The growth of the metaverse and GameFic has brought NFTs to worldwide attention, even from crypto aliens! According to The Block Research, non-fungible token (NFT) trading volume exceeded a whopping $13 billion in 2021.
The new gaming paradigm enables verified blockchain ownership of gaming assets like NFTs. They can be easily traded, exchanged or used on other interoperable platforms. They are now also adopted in a wide range of industries, including art, music, and sports.
YouMinter, a user-friendly NFT marketplace development company, launched its IDO on UpLift in December to great acclaim, raising 450,675.02 BUSD.
4. AMM DEX
The role of decentralized exchanges in an industry that is distinguished by its decentralized vision cannot be emphasized enough.A Chainalysis report reveals that the amount of DEX doubled between Q1 2019 and Q3 2021, while the amount of CEX remained about the same.
The growing popularity of DEXes in the last two years has a lot to do with the impressive growth of DeFi. From around $10 billion in July 2020, the total value received by DEX increased to $368 million in May 2021. That’s a growth of 3579%! The rapid expansion of the cryptocurrency development company requires more DEXs with additional features, functionalities, and blockchain support.
UpLift hosted the Jumbo Exchange IDO last month, raising 99,999 BUSD. It is the second AMM DEX on the Aurora Network. The launchpad supports projects that are based on a wide range of emerging networks, including Aurora and NEAR.
How to start
Launch pads like UpLift DAO step up the game, taking the best of the pioneering projects and adding some amazing new features that ensure higher representation.
To begin with, UpLift follows a community-based capital deployment model. Unlike many launch pads today, the assignment is not based on tiers. It features a lottery-based token allocation system to allow for a diverse set of participants. The showdown period after each IDO ensures greater representation.
