Initial Coin Offering (ICO)

An Initial Coin Offering (ICO) is a fundraising mechanism used by blockchain projects to raise capital by issuing new tokens to investors in exchange for cryptocurrencies like Bitcoin or Ether. ICOs are often compared to Initial Public Offerings (IPOs), but instead of company shares, investors receive tokens that may have utility within the project's ecosystem or serve as speculative investments. ICOs gained popularity in 2017, with projects like Ethereum being early examples. However, the unregulated nature of ICOs has led to concerns about fraud and scams, as some projects raised funds without delivering on their promises. ICOs remain a high-risk, high-reward investment method.