First off, what is a Token? Tokens are assets or utilities that are often constructed on blockchain technology and created through a contract, making them more functional than traditional cryptocurrency.
A Token Generation Event (TGE) is a commercial and technical event that involves the technical generation of a token in a blockchain-based network and its release to the market, typically in the form of a public sale, private sale, or initial coin offering (ICO). Token Generation Events are frequently utilized to gain exposure and involvement in crypto/blockchain communities with the purpose of funding.
This article gives a rundown of numerous fundraising and token launch options prevalent in the crypto world. Without further ado, let’s dive in.
Initial Coin Offering (ICO)
One of the most popular techniques for beginning a cryptocurrency enterprise is through an Initial Coin Offering (ICO). An ICO is a method for a project to acquire funding from investors by selling a percentage of its currencies. Investors can then choose to cash out their investment when the project begins, or to keep onto their coins until they generate an even greater return.
With so many possibilities and so many unknowns in FinTech, here are the pros and disadvantages of ICOs and if they are worth the hype:
Pros
- Readily accessible for investors and startup companies
- Online accessibility
- Less paperwork
- High liquidity
- High ROI
Cons
- Volatility
- A potential fraud
- Lack of accountability
Investors are urged to examine all elements of the firm, including their reputation, important staff, and the amount of successful projects launched, before choosing on which ICO to participate in.
Initial Exchange Offering (IEO)
The Initial Exchange Offering is similar to the ICO, but there are two key differences. First, only carefully vetted initiatives can raise funds on the exchange that hosts the IEO. As a result, the reputation of the exchange acts as an extra assurance.
Second, unlike with ICOs, investors are guaranteed that the tokens they acquire will be listed on this exchange, allowing them to at least sell their tokens.
Furthermore, both the startup team and the investors must pass KYC and AML processes, which decreases the chance of fraud.
Initial DEX Offering (IDO)
The current term in bitcoin funding is Initial DEX Offering. It is similar to IEO in that only vetted projects are granted access to IDO (at least in principle), and their tokens are immediately published on the decentralized market.
However, rather than a team of specialists, the DEX community determines whether to authorize a certain project to hold IDO on the platform by voting. Furthermore, all cash movements are regulated by smart contracts, removing the need for a third party.
Finally, because there is no centralized entity engaged, KYC and AML processes are not necessary. However, depending on the laws enforced on IDOs in various nations, the final statement may alter shortly.
Initial Public Offering (IPO)
In this new age of digital asset tokenization, the Initial Public Offering (IPO) is being disrupted, with cheaper costs, less strict execution, larger investor pools, suitability for startups, shorter fundraising durations, more effective contract administration, and greater and faster liquidity.
Asset Token Offering (ATO)
The Asset Token Offering is a fundraising mechanism in which the money generated by the assets is turned into services or products. The public can acquire in advance in order to participate in, say, property development.
A third party will oversee the assets to guarantee that the project progresses and works as planned. Real estate, intellectual property, and accounts payable and receivable are examples of assets that might benefit from ATOs.
Initial Convertible Coin Offering (ICCO)
The Initial Convertible Coin Offering is a way of generating funds in which a ‘tokenized convertible warrant’ is governed by a prospectus that must be approved by a public body.
These initiatives are subject to strict standards, and their issuance will grant investors the ability to convert these tokens into company shares after a specific period of time.
Decentralized Autonomous Initial Coin Offering (DAICO)
The Decentralized Autonomous Initial Coin Offering (DAICO) is a fundraising method that incorporates some of the advantages of a Decentralized Autonomous Organization (DAO), which are digital companies with certain rules smart-contracted on the Blockchain, making their management transparent and auditable.
The DAICO concept adds another layer of accountability to the project team. Rather than releasing all the funds obtained at once to the project owner, contributors are empowered to make investment funds accessible in a more controlled manner, using a consensus method, voting how much cash they wish to release to the project team on a recurring basis.
The Abyss, for example, is a gaming platform with diverse social features and income potential that is intended to be your solitary doorway to the universe of MMO games.
Initial Fork Offering
The Initial Fork Offering (IFO) is a technique of fundraising in which an existing Blockchain, such as Bitcoin, is “forked” off the main chain in order to improve the protocol. In theory, the new coins created by the bifurcation are free. The theory holds that if enough people have it, they will start trading it, and it will eventually increase in value.
The project owner will eventually be able to collect revenue by selling their own (typically pre-mined) coins onto the market. Bitcoin forks such as Bitcoin Cash, Bitcoin Diamond, and others are examples.
Initial Airdrop Offering (AIO)
The Initial Airdrop Offering (IFO) is a type of fundraising that is quite similar to IFO. Newly minted project coins are ‘airdropped’ (freely given) to wallets of selected participants. Frequently, certain requirements exist in order to obtain the ‘free money,’ such as pre-holdings of specific other currencies or involvement in project marketing efforts (which then, makes it a bounty).
As with IFO, if people’s enthusiasm in the project leads to coin trading — perhaps leading in value increase — the project may subsequently sell its coins to raise revenue. Polymath (POLY) and Bitcoin Cash are two examples (BCH)
One of the key factors in having a successful TGE is making sure that people know about it, specifically your target audience For example, a project that is serious about launching a token may seek the assistance of a TGE marketing agency to establish a plan aimed at capturing the project’s target audience.
But before a project even considers marketing, there is an entire checklist of things to do to give the project the best chances for success.
Step To A Successful TGE
Many moving elements are required in developing a successful TGE, which is why many companies hire a marketing consultancy team to assist them. Getting a project off the ground is difficult, and competition is tough. There is no one exact magic formula to ensure a successful TGE, but there are some general guidelines.
Keep reading for an in depth breakdown of the procedures involved in a TGE.
Assess The Feasibility And Need For Token Sales.
Is your idea truly in need of a TGE? That is the first thing you should ask before proceeding. To join the market, you will need a project superior to what is presently available. You want to see if your concept fits these requirements.
That implies you must be familiar with your investors and target audience, have a thorough grasp of your business, and know exactly what you want to deliver in exchange for an investment.
There are thousands of cryptocurrencies and tokens in the market today, What sets your project apart from the pack? What problem are you solving? That is, if you want your enterprise to flourish, you must have a token that is in great demand.
To increase demand for your token, ensure that it is meaningfully and usefully incorporated into your project. Some cryptocurrency ventures on the market include currencies that make no sense. Consider if tokenization is truly necessary.
If the answer is no but still utilizes coins, you will likely put off potential investors. They will not invest in a project that cannot define its requirements. Visit preannouncement forums and start a topic about your project to seek input.
Determine the Primary Markets and Appropriate Legal Jurisdiction
TGEs are one of the blockchain industry’s most extensively regulated and scrutinized areas. In the early days, ICOs were the wild west and many poor projects and even outright scams flourished. There has been much ground made in the legal landscape of crypto recently, but more work still needs to be done. Despite its difficulties, most governments now acknowledge TGEs as a legitimate procedure.
However, because of stringent rules imposed by government organizations like the SEC, TGEs are forced to disclose any revenue stored offshore and must adhere to Know-Your-Customer (KYC) laws. Because of these rules, several TGEs no longer allow US people to purchase their tokens.
The fact is that investors and regulators are increasingly taking TGEs very seriously. That means you must pay great attention to effectively completing the current standards while also keeping an eye out for future modifications.
Hiring a lawyer who primarily works in crypto and is familiar with ICO legislation is an excellent way to manage this aspect of your ICO. It may not be cheap, but it will be significantly less expensive than the fines imposed by the SEC or IRS on your organization.
Having a legal council also indicates to investors that you are not abusing their funds. The last thing you want is your initiative to be associated with illegal activity. Be open and honest about what you’re doing with investor funds, and always offer clear and succinct responses to any questions concerning the financial elements of your ICO.
Selecting the Best TGE Launch Platform
It’s now time to pick the best platform for launching your TGE. Before making a final decision, you must think about a few things. To begin, A crypto launchpad is a platform that helps entrepreneurs raise capital and acquire attention for their projects. Successful crypto launchpad initiatives include mentorship, marketing, and technical assistance.
The most popular crypto launchpads are Binance Labs, Huobi Prime, OKEx Accelerator, and Bitfinex Pulse. Several successful ventures have leveraged these platforms to earn millions of dollars and a sizable user base.
To select one, you have to evaluate the services provided by the platform. How involved will the firm be in the launch of your private sales, public sale or ICO?
You’ll want to choose a token sales platform that will walk you through the full launch process and be available to you if any issues emerge. You’ll also want a team that is both accessible and competent. Is the team familiar with past successful token launches? Do they have the requisite skills to guarantee that your token launches smoothly?
Accepting different payment choices for your coins makes sense if you’re providing your token abroad. Whether you take money or cryptocurrency, the more you can swap, the more diverse your investment base. Find a launch platform that accepts several currencies, so you don’t have to limit your investors.
Overall, you want a launch platform that simplifies your life and your team’s lives. A token launch is difficult; therefore, search for a business that communicates and simplifies the hard and challenging duties.
Make a competitive token.
We briefly discussed this in earlier parts, but designing a competitive token is crucial. However, many initiatives generate a fantastic and one-of-a-kind coin and fail to recognize that there are further steps to reach the finish line. For example, you must know how you want to distribute your tokens after launch.
TGEs can be organized in a variety of ways, including:
Static supply and static price: A company can set a specific funding goal or limit, which means that each token sold in the TGE has a preset price, and the total token supply is fixed.
Static supply and dynamic price: A TGE can have a static supply of tokens and a dynamic funding goal, which implies that the ultimate price per token is determined by the amount of cash raised in the TGE.
Dynamic supply and static price: Some token sales have a dynamic token supply but a static price, which means that the supply is determined by the amount of financing received.
An essential tool utilized in TGEs to ensure equitable token distribution and prevent future manipulation by whales is Token Vesting Period.
The vesting period, also known as the token lockup period, is a period during which tokens issued at the pre-sale stage and distributed as incentives to partners and project team members are not sold for a set length of time.
Token vesting ensures token holders are protected from huge price fluctuations, since early investors must wait a certain amount of time before selling their assets.
Also, Token lockup allows for the development and launch of a product, especially if there is no prototype currently. During this time, investors can assess the project’s development and decide whether to keep their tokens or exchange them for another money, such as Ether or Bitcoin.
Of course, how you distribute your coins will be determined by your strategy. Token sales, for example, might have numerous stages. Some TGEs include a pre-sale, a private sale, a public sale, and the TGE itself. After you’ve decided how you’ll sell your tokens, you may pick how they’ll be distributed.
How much will you invest in yourself and your team? How many tokens do you intend to sell at each stage of the TGE? Will you be issuing more tokens in the future? You must answer all of these questions before tokens are distributed.
It is not difficult to create a token, especially if you utilize Ethereum ERC-20 or Binance BEP-20 tokens. These systems make it very simple to create tokens. However, before creating and distributing tokens, consider whether they are important for the success of your enterprise.
Take security into consideration.
Another consideration you should make before launching a token is security. We’ve spoken about how investors are getting better at detecting frauds and other bad motives. That implies your project must safeguard not only itself, but also its users. Listening to your community is one method to do this.
Investors and community members have a vested stake in your token’s success. So, when they bring up security issues, you should listen to them. Furthermore, demonstrating that you are listening helps build trust and demonstrate that you wish to address concerns before they become major ones.
Also, adherence to TGE best practices is essential to keeping a water tight security system that won’t be susceptible to cyberattacks, thus keeping investor data and investments secure.
Important TGE best practice tools include;
Smart Contracts: Smart contracts are, at their core, just codes – computer programs written to efficiently imitate real-world legal arrangements with executable command lines that allow them to perform autonomously, as though independent of human intervention. These computer programs function as a go-between between the token issuer and the investors, eliminating the need for a third party to oversee and maintain the contract’s contents.
Digital Wallets: The digital wallet is another component of the token sale IT infrastructure. One of the primary functions of a digital wallet is to serve as a store for the private keys required to authorize token activity or perks on the blockchain.
MultiSig Wallet: A MultiSig wallet is a type of digital wallet that uses multisignature addresses. This indicates that a crypto transaction requires more than one private key to sign and approve, or that many separate keys can be used to establish a signature in some instances.
Off Chain Component: Because the quantity of data that can be saved on a smart contract is typically restricted, it is critical to choose whether data (or meta-data) should be stored on-chain vs. off-chain. The latter must also be kept and secured in accordance with best practices for information security.
KYC/AML processes: Know Your Customer (KYC) / Anti Money Laundering (AML) is a due diligence procedure that checks clients’ identities and ensures that the money used for the specific transaction was obtained legally.
Technology is continuously evolving, as are methods for hackers to access your project. However, if you have the right team in place, you should be able to detect and eradicate these rather fast. Phishing schemes, on the other hand, are a whole new ballgame. It would be best to educate your staff on the risks of providing corporate information and train them to spot frauds.
Anyone who participates in an TGE understands that they are never completely risk-free. To ensure the success of your TGE, you must take the required steps to create best-in-class security standards. This guarantees that your users are safe and that your TGE is as secure as possible.
Create a thorough Token White Paper.
The majority of credible crypto ventures have a white paper. Many people consider this document the technology underlying the project and should provide that information. On the other hand, a good white paper will contain considerably more. It should encompass infrastructure, architecture design, development, and other topics.
Because of its length and technicality, your white paper is unlikely to be seen by many people. Just a few dozen individuals will likely read it in its entirety. However, they are the folks who understand what you’re doing and will point out any flaws in your project.
If they recognize the worth of your initiative, they will be the ones to move it forward. They will be advocates and allies for you and your company, spreading your ideas to thousands of people. That is why having a valid, detailed, and comprehensive white paper is essential.
Provide full-service token sales marketing and public relations services.
You’ve validated that you need a currency for your project and have satisfied all legal criteria. You’ve also made certain that security is as excellent as possible and prepared your white paper. It’s time to start talking about your project and what it offers.
This takes the shape of public relations and marketing, which will not be cheap, so be sure to budget accordingly. You may hire a qualified crypto marketing and public relations agency to assist you with this part of the process. This stage tries to showcase your concept from the standpoint of a possible investor.
Finding your target audience and delving deeply into their habits, expectations, and motivations is the goal of public relations and marketing. With this knowledge, you may explain your idea clearly, succinctly, and simply while strategically placing it in the market. You may also decide how your project will be announced at this point.
The goal is to generate attention and buzz. You can achieve precisely that with adequate marketing and public relations, compelling investors to participate in your TGE, so they don’t miss out on the “next great thing.” Collaborate with your public relations and marketing teams to educate the appropriate stakeholders about your initiative.
Start a Social Media Marketing Campaign
Once you’ve selected your PR and marketing team, you can begin collaborating to identify how you want to handle social media. Because this is a difficult process with many moving pieces, it is critical to set everything out before proceeding.
You may communicate with the cryptocurrency community in a variety of ways. For example, several projects choose to use Reddit, a network with over 40 Subreddits dedicated to Bitcoin alone. Hundreds of Subreddits cover altcoins, cryptocurrencies, ICOs, and other blockchain-related issues.
Telegram and Discord are two more apps that are gaining popularity in the crypto world. Both platforms let users create their channels, which helps you keep your audience updated regularly. You may also create private groups on Discord and Telegram to talk openly with possible investors.
Of course, you may also publicize your TGE campaign on other channels like LinkedIn, Facebook, Instagram and Twitter. Creating accounts on these sites may not be the most appealing approach to contacting your target demographic, but they have a worldwide reach, allowing you to advertise your campaign globally.
Another massive marketplace for ICO promotion is TikTok; TikTok is the new kid on the block regarding social networking. But don’t be fooled by this; TikTok has amassed 1 billion users across 154 countries!
Create your own Token community.
Creating a social media marketing strategy for your TGE goes hand in hand with building a community. It’s important to post announcements and updates on the most prominent social media channels, but you’ll also need to communicate with your token community.
What does this resemble? To begin, it entails engaging with your community. Spend time answering questions and hosting AMAs. Provide as much information to your community as possible. Many projects have discovered diamonds in the rough in this manner. Enthusiastic people volunteer to answer queries, allowing you to focus on other parts of your token launch.
Of course, these users believe in your project, and what you’re doing, so you may want to compensate appropriately, whatever that means for your business.
You may also tell your tale to the token community. Explain how you got started and why you decided to start your project. What’s the backstory, and how did it come to this point? This helps cultivate genuine and lasting ties within your community, allowing your initiative to flourish and prosper.
Stats are another approach to creating your token community. Show your audience instead of informing them about your idea. Explain to them the gaps in the current market. Explain how your company intends to tackle this challenge and expand in the future. Your users want to be engaged, and showing them helps them to feel like they’re a part of something bigger.
When you constantly drive serious debates, the community becomes bored. It is critical to please all the members. Contests and events may frequently generate community interest in your initiative. Here are a few ways to keep your community continuously engaged;
- Launch giveaways
- Use gamification to engage members.
- AMA holds community conferences
- Community gatherings and activities
- Programs for doing quizzes
- Hackathon
All these activities can be carried out across different social media platforms, ranging from Twitter, Discord, Facebook, Telegram and Discord. Reward the community with native tokens or presents that feature the project emblem.
Make Appealing Bounty Programs and Giveaways
Bounty programs are another great approach to publicizing your TGE. Furthermore, they are linked to the development of your community and the creation of your social media marketing strategy. Bounty programs are incentives for public relations-related efforts. Essentially, you’re paying folks to share information about your TGE on crypto-related forums, boards, and other channels.
It might also reward users for blogging, document translation, and other activities that promote the launch of your token. However, keep in mind not to go too far with this form of promotion. Those who have worked in the sector for a time will be familiar with bounty programs. Furthermore, while the brand promotion is anticipated, misusing it enrages experienced consumers.
You may develop a bounty program for people who identify bugs in your product and reward those who promote it. Crowdsourcing is an excellent approach to uncovering flaws without paying for a QA department. You may enhance your project before going to market and launching your token with bug bounty schemes.
You may also employ bounty programs after your TGE. You employ these reward programs to tie up any loose ends throughout the TGE process.
Describe your project’s post-launch strategy.
You’ve finished all the required requirements and successfully launched your token. Congratulations! But you’re only getting started. You have a lot more work ahead of you. For example, you must now distribute the tokens to project investors. However, it would help if you addressed much more than that.
You don’t get to sit back and do nothing just because you had a good launch. You can take a breather, but then it’s back to work. You must keep your project at the cutting edge of the market. This includes continuing to advertise your coin using blogs, social media, forums, and other channels.
You’ll need to keep growing your community and encouraging audience engagement in your project. You’d need to be frugal with your funds, unless your TGE generated millions of dollars. Obtaining community support can assist you in keeping your project on track.
Finally, market yourself. Because you are the project’s leader, there are individuals in the community who want to hear from you. Set aside time to attend events and conferences.
While creating alliances, discuss your opinions on the blockchain industry with other thought leaders. This will give your firm the momentum it requires to succeed in the foreseeable future.
Are you feeling disoriented? Trying to create a successful marketing plan but running across roadblocks? Let us handle it. We know how to design plans that produce long-term success, thanks to our extensive expertise in digital marketing.