Why I Avoid IEOs

Hey Jesspeculators

The cryptocurrency market has changed over last 4 years and watching it transform by showing up every day, it's almost unrecognisable from the lawlessness of the 2017 ICO era, it's still pretty much the wild west but it's calmed down in relative terms, but that doesn't mean there aren't major pitfalls still running today.

The ICO is a great idea, but it was ultimately flawed, creating a speculative bubble where people weren't investing for the long term but just trying to ride shifts in capital and getting in on the spreads they create.

Those who ran ICOs were also majority self-serving and it wasn't about fundraising projects but getting money for not having to deliver on a product, that would see many lose money.

A new lick of paint

As the ICO market became a toxic tainted one we saw regulation come into play with things like STO's (Security Token offerings) that would need to meet certain legal requirements to run an ICO while exchanges also saw ICOs as a way to keep their trade volumes up and lend their legitimacy to projects, this was known as the IEO (Initial Exchange Offering).

Just like the ICO the IEO sounds like a great idea in practice but what I've noticed is that it's got its own rigged game going. ICO's could be set up by anyone and it was more of a manual submission making it kind of fair and slow to get in a secure your bags before the various exchange listings.

IEOs are run on exchanges and the smart money have backing so they are able to connect to exchanges via API's and put in buy orders faster than any manual bidding by a retail investor.

This leaves Davey day trader and the rest either to pick up what's left or buy-in from the new order book from those who have already secured their position. So you won't get in at the initial price you're getting in at the resale price and hoping new dumb money comes in after you since you're "early enough"

The game isn't in your favour

The whole attraction to IEO's is either to ride the early excitement launch pump or because you really like this project and want to support it. Either way, you're not getting in at the initial price and you're being scalped in the process. Yes, you could make money but be aware that exchanges and other insider traders are the ones setting the price once you finally get in to place an order.

Have your say

What do you good people of HIVE think? Have you bought an IEO before? Which IEO was it and with what exchange? Did you make good gains?

So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."

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