What Are IDOs? How to get involved in a crypto project before the IDO?

4 min readJul 28, 2021

Since their relatively recent inception in 2021, initial DEX offerings (IDOs) have become the new hot topic of the crypto world. Let’s take a deeper dive and look more closely at what they are, and what they do, along with how you can benefit from this new means of raising funds.

Some IDO History

We’ll start our trip by going back to 2016 and 2018.That’s when the initial coin offerings (ICOs) first made their appearance. These allowed dev teams to sell part of their total token supply to the public. Making use of Etherium’s ERC-20 protocol, these ICO’s started by raising a few million dollars in 2016. Just a year later, the average raise grew to around $30 million. The hype was strong and so it was no surprise that Bancor managed to raise over $150 million. Later on, EOS took in $4 billion through their ETH-based token sale.

The Birth of Initial Dex Offerings

But what goes up, must come down. The bubble burst on ICOs in 2018. From the ashes arose the Phoenix of initial exchange offerings (IEOs) which were different from their predecessor in that there was a great deal more due diligence. Thanks to the growth in popular exchanges like PancakeSwap (BSC) and Uniswap (Ethereum), it became possible for anyone to start trading their tokens for funding. Then in 2021, Initial Dex offerings entered the fray and became the dominant force as the successor to both ICOs and IEOs.

What Makes Them So Special?

IDOs differed from the previous two concepts in that, though the idea to raise funds and bootstrap projects remained the same, the method was to list immediately on a decentralized exchange,(hense the name DEX) instead of offering tokens to be sold prior to their listing. Benefits-wise, this allowed for immediate liquidity, fast trading, and open and fair fundraising. Except it didn’t really. Token sales would be over in just a matter of seconds leading to accusations that both insiders and bots were getting in first. To rectify this, and bring us up to date, third party launchpad platforms were developed and gradually took center stage.

No Launchpad, No launch

Today’s IDOs must first approach third party launchpads, and providing they meet all the relevant criteria, only then can they move forwards to launching their token. But users can’t buy tokens directly, they must instead purchase IOUs of the tokens. Only after the IDO are the tokens listed for trading on a decentralized exchange. Because most of today’s projects are constructed around Ethereum, many tokens are using the ERC20 protocol and listed on Uniswap.

Divide The Pie Fairly

So, that’s the “what is” and the history of IDOs. But how can you take advantage of a potential high selling token, if launchpad platforms are limiting the number of participants? It’s interesting to note that IDOs tend towards a very low market cap for their public listings. Compared to ICOs and IEOs, they raise by far the smallest amount of capital, with individual allocations of a couple of hundred dollars or less. There are a number of genuinely good reasons for this.

Thinking Long Term

The first is to stop the destructive round of “pump and dump” as soon as the token is listed. Related to this is an effort to maintain higher prices during the price discovery period. Keep in mind, though the fundraising can successfully raise pretty big sums, it’s the circulating supply that matters most. The launchpad platform will be performing a strict whitelisting process to whittle down the number of overall participants. They do this by creating what can only be described as a “marketing storm.” And that’s something you can directly benefit from.

Here’s What You Need To Do

To get whitelisted, you’ll need to polish your social media marketing chops. The requirement will, more often than not, involve being very active across all social media platforms. For a start get yourself on the Telegram and Discord chats for the project. Then start tweeting and retweeting content. Finally, you’ll need to promote the project’s social media profile everywhere. For example, Next Earth.io, a new metaverse ecosystem, is going to be doing an IDO later in 2021. You can already get on board via all their social media platforms.

Go Buy Land

Even better, you can join the project by buying virtual land as an early adopter. On 2nd of July 2021, their land pack pre-sale starts. By spending as little as $150, you can get your foot in the door and get in before the pricing algorithms kicks in for the public land sale, which begins on the 19th of August 2021. Like the 19th century pioneers ever pushing West to find land for settlement, you can be the first to stake your claim in the virtual world.

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