An Initial Coin Offering (ICO) is a fundraising method that companies in the cryptocurrency industry will use to raise capital to develop new currencies, applications, or services. It is often compared to an initial public offering (IPO) in the traditional stock market. During an ICO, interested investors can purchase tokens or coins issued by the company in exchange for fiat bids or stable cryptocurrencies such as Bitcoin or Ether. These tokens may have a benefit related to the product or service offered, or may represent a stake in the company or project.
ICO campaigns typically involve issuing a whitepaper outlining the project's goals, the problem it aims to solve, the amount of funding required, the distribution of tokens, and the duration of the campaign. Fans and backers of the project can participate in the initial coin offering (ICO) by purchasing tokens using fiat bids or other cryptocurrencies. If the funding goal is achieved and the project is launched successfully, the tokens are expected to become functional units of currency within the project ecosystem.