Initial Dex Offering (IDO)

An initial dex offering (IDX) is an alternative to an initial coin offering (ICO).

In the same way that traditional startups receive venture capital before launching, projects issuing initial DEX offerings receive financing from individual investors. Unlike an initial public offering, investors in initial dex offerings never own any equity in the project.

IDOs have some benefits that may make them more attractive than ICOs and IEOs: immediate liquidity, immediate trading and lower costs for listing.

‍An initial DEX offering or IDO refers to the launching of a cryptocurrency on a decentralized exchange (DEX). In an IDO, a blockchain project makes a coin’s first public debut on a DEX in order to raise funding from retail investors. IDOs have similarities with initial exchange offerings (IEOs), where crypto projects launch their token and raise funds via a centralized exchange, since both allow immediate trading on top of raising funds. However, centralized exchanges impose strict ground rules including:

IDOs, on the other hand, can offer a far more cost-effective token sale and listing model. Firstly, an IDO provides quick liquidity with little to no slippage through available liquidity pools in a DEX. Relatively, it has cheaper listing costs. And like IEOs, it allows instantaneous trading.

Examples of DEXs that offer IDO services include Binance DEX, Polkastarter and Uniswap. Most traders also prefer IDOs over ICOs since IDO listings prevent the issuer of the tokens from controlling how the fundraising round will go. One of the first IDOs launched in the space was RAVEN, which was listed in Binance DEX in June 2019.