Differences between ICOs and other forms of crowdfunding

Not all people come to feel the need, or set the goal of carrying out a project or doing reality an idea that could be very innovative, and not have the resources to carry it out.

This happens because not all people have the same goals, and the areas in which each person operates are different. But there is a group whose ideas need more money than they have.

An example of this could be a person dedicated to the practice of medicine, who wants to carry out a project of research, but it requires material, personnel and time, for which it will require financing to carry it out. cape.

Some years ago, depending on the project, there were some possibilities of receiving this financing. In the case of scientific research, help from a university, institution, or perhaps a government might be possible.

But there were also cases where the interest was not academic, such as that of a person with an excellent idea for a video game, or an artist with an idea for an expensive performance, in these cases it might be more difficult to find the right financing.

However, for some years ago, with the help of the internet and its ease of connecting to the world, the so-called crowdfunding o Crowdfunding has become popular, and has made many projects come true.

The way in which the platforms of crowdfunding It may differ in some respects, but in general, the idea is for a person, group or entity to raise a certain amount of money to start, or exceed the amount.

In other cases, financing is done monthly or every so often, with a fixed amount or one-time, and generally receiving a non-economic incentive, which allows to enjoy more benefits related to the project that is finances.

The emergence of this form of financing has allowed many people to produce or make a reality great ideas and projects that normally could not generate an income, or are expensive.

Blockchain, cryptocurrencies and crowdfunding

Bitcoin, cryptocurrencies, and especially, although less notoriously, Blockchain, have changed the way people see many things, in a relatively short time.

The change they have made to the economy, the way of paying and the way of making money is especially noticeable; Well, cryptocurrencies are virtual currencies, and they are created in a very intelligent and complicated way, but especially different.

Similarly, Blockchain and cryptocurrencies have given rise to a new form of crowdfunding, known as ICO, whose initials mean Initial Coin Offering (Initial offer of Currency in Spanish).

ICOs can essentially be defined as one more form of crowdfunding, except that you always have to give the people who finance a kind of currency, called token.

Although tokens can be better described as tokens or coupons, or even as proof that a person contributed money to a project, and therefore the tokens they will be the incentive.

The tokens They are not the same as a cryptocurrency, since they cannot be mined, nor will they work like the most popular cryptocurrencies, but will generally have their use within the economy formed within the framework of the financed project, which could be for example a mobile app; but it can be many other things.

Another aspect in which an ICO tends to differ from other types of crowdfunding is the range of projects that can be devised and for which to seek financing, since they will generally be related to blockchain.

This is relative, since an ICO campaign can potentially be created for projects that do not make use of blockchain, but since it is an Initial Currency Offer, you must precisely give these coins, which are the tokens.

Indeed, there have already been ICO campaigns that have been successful, raising millions of dollars, even in the first minutes after starting, and whose projects are not directly related to the technology blockchain.

However, it is more likely, or perhaps more suitable for a project to which funding is sought through an initial offer campaign, that its execution needs or is benefited by blockchain.

In this sense, technology and computing are a very important part of ICOs, but the possibilities it offers blockchain are extensive and still being explored, so many non-tech areas could benefit from blockchain or by ICOs.