Top 5 Initial Exchange Offering (IEO) Platforms
Initial Exchange Offerings (IEOs) have taken 2019 by storm. Following 2017/18 Initial Coin Offering (ICO) craze, IEOs are becoming a new mania which is capturing the middle ground between promising projects and eager investors.
IEOs are interesting phenomena. They are more secure than ICOs, more accessible than security token offerings (STOs), and there’s particular due diligence done by the IEO platform before listing the projects. All these factors raise investors confidence in the projects, which results in millions raised in seconds, overbooked platforms, and new, promising projects and coins entering the cryptoverse.
Desirable characteristics of IEO platforms
In our “What is an IEO?” guide we’ve counted more than 32 IEO platforms. All of them are different, and some of them are definitely better than others. One must mind that most exchanges have a monetary incentive to launch as many IEOs as possible as they make good money by doing so. This raises a fundamental question - which IEO platforms are the best?
These are the key factors to pay attention to when choosing an IEO platform:
- Exchange/platform reputation. Credibility and reputation of exchange are the most crucial factors when choosing an IEO platform. Since exchanges vet all IEO projects, you have to trust them completely. IEOs provide lucrative opportunities for the exchanges, and all IEO profits come from eager investors like you. Therefore, you have to look for exchanges that are genuinely focused on the quality of the projects instead of useless token sales. Always do your own research (DYOR).
- Ease of use. Participation in an IEO should be as frictionless as possible. Unlike ICOs, IEOs are mediated by the exchanges, so it is their responsibility to make it accessible even for novice investors.
- Liquidity. A solid IEO platform should have an abundance of investors willing to trade the token. Remember that an IEO token is listed on its exchange almost immediately after the IEO, so you want to be sure that you have no issues when selling it later.
- Security and stability. IEOs attract many investors from various backgrounds, so IEO platform must be robust and secure. No one wants to risk losing their funds to an incompetent exchange, which is prone to all sorts of cyber attacks, technical glitches, or bad performance.
- Multi-coin support. IEOs are an increasingly popular way for exchanges to increase the value of their native token. However, most investors don’t want to be limited to one or two coins when investing, so having multiple options definitely helps.
Based on these criteria, we've selected the top 5 IEO platforms that are worthy of your attention.
1. Binance Launchpad
Binance Launchpad is the pioneering IEO platform which launched in 2017 just to become mainstream in 2019. It had many successful IEOs, including Matic Network (MATIC), BitTorrent (BTT), Celer Network (CELR), Fetch AI (FET), Bread (BRD), and others. At pixel time, the average ROI for Binance IEO investors is nearly 580%.
Binance Launchpad is arguably the best token launch platform on the market. It is backed by one of the top exchange’s in the world and is led by a class act Changpeng Zhao. The launchpad is powered by leading technology (capable of processing over 1,400,00 orders per second) and high-level partnerships which bring an abundance of investors to every token sale. Hence, liquidity is rarely a problem on Binance.
In fact, Binance’s Launchpad has attracted so many investors it had to introduce a “lottery method” to give everyone equal opportunity to invest. In most cases, investors must purchase BNB (Binance’s native token) to participate. Besides, the platform supports all sorts of languages and devices, making it easier to invest in IEOs regardless of where you are.
In sum, Binance Launchpad is both pioneer and leading IEO platform in the market. Although it requires luck and BNB tokens to enter a sale, its solid relationships with industry leaders, high-profile investors, and industry-leading advisors make it a high-quality platform, which is why it tops our list.
2. OK Jumpstart
OK Jumpstart by OKEx is an excellent platform for quality blockchain projects. It offers a high-quality liquid market, top-notch exposure, and token listing opportunity in one of the most popular exchanges in the world.
OKEx introduced a subscription plus allotment approach to avoid oversubscription. This way, there’s a brief 30-minute subscription window before an IEO which closes if the max limit is reached. Then, the allotment part follows: an investor must hold a minimum of 500 OKB (OKEx exchange token) for seven days or at least 3,500 OKB at the snapshot time before the token sale. The allotment amount is based on your OKB holdings. The more OKB user has, the more significant the allotment amount one gets. OKB is the only accepted token on OK Jumpstart IEO platform.
The average ROI on OK Jumpstart platform is approx. 285%, which, in most cases, makes it a worthwhile venture.
All in all, the platform checks all the required marks to be one of the top IEO platforms - a reputable, easy to use high liquidity exchange, powered by top technology and credible team.
3. Bittrex IEO
Bittrex doesn’t have a unique name for their IEO platform, but it is unlikely that they need one. It is a long-established and popular cryptocurrency exchange with sturdy security measures, infrastructure, and liquid markets.
Bittrex doesn’t have an exchange token, so its token sales raise funds with Bitcoin (BTC). That makes its IEOs more accessible to everyone. However, it hasn’t introduced any “fair distribution” procedure either, which means you have to be extra fast to make your IEO purchase count.
Currently, the Bittrex IEO platform ranks near the bottom of all platforms in terms of profitability with an average -46% ROI. For the most part, this is due to Ocean Protocol IEO, which dropped more than 80% after its listing.
Despite that, Bittrex remains a competitive IEO platform with many hot and gainful projects on it.
4. Huobi Prime
Huobi Prime by Houbi Global launched in March 2019 to provide ambitious crypto projects with funding. It’s a powerful platform built on top of one of the exchanges with leading trading volume.
Huobi Prime boasts of its innovative Direct Premium Offering (DPO) feature. It stands out due to the following advantages:
- Rigorous project screening process which ensures that only premium projects make the cut.
- All purchased coins are immediately deposited into a users account and can be traded on Houbi Global for Houbi Token (HT).
- Early access to coins below market prices.
- Equal opportunity for both big and small players, where individual purchases cannot exceed $1,000 worth of HT.
- There are periods of tiered price limits which mitigate extreme volatility when the market opens.
So far, Houbi Prime's IEOs have yielded average returns of around 240% as it has proven to be a robust and reliable IEO platform with a decent incentive structure.
5. KuCoin Spotlight
A former top 10 exchange, KuCoin, is trying to regain its significance with KuCoin Spotlight, its native IEO platform. After upgrading the exchange to a new 2.0 version, it is still one of the best and most recognized exchanges in the market.
KuCoin Spotlight IEOs are powered by its native KuCoin Shares (KCS) token, and the token sales follow the first come, first served principle, so you have to be faster than other investors. The platform itself is secure, easy to use. All previous IEOs have yielded almost 80% gains.
In sum, KuCoin Spotlight ranks among the best IEO platforms out there. Although there have been some complaints from the investors who didn’t manage to make their purchases on time, it has been an issue with most IEOs.
So far, IEOs raised approx. $1.5 billion in 2019 (including the notorious $1 billion Bitfinex LEO token IEO). At the same time, ICOs collectively raised over $1.1 billion, meaning that for the first year, IEOs manage to raise more than ICOs.
The average return in an IEO varies by the project and platform. The best performing IEOs to date (June 1, 2019) are the following:
- BitTorrent (BTT) - Binance Launchpad - 12.35x price increase.
- Matic Network (MATIC) - Binance Launchpad - 7.89x price increase.
- V Systems (VSYS) - ZB.COM Launchpad - 4.51x price increase.
- BlockCloud (BLOC) - OK Jumpstart - 3.81x price increase.
- BRST (BRST) - DigiFinex Apollo - 2.98x price increase.
- Top Network (TOP) - Houbi Prime - 2.86x price increase.
- Trias (TRY) - KuCoin Spotlight - 2.43x price increase.
- Celer Network (CELR) - Binance Launchpad - 2.29x price increase.
- The Force Protocol (FOR) - Bibox Orbit - 2.18x price increase.
- ALLIVE (ALV) - OK Jumpstart - 2.03x price increase.
Looking at current and average returns since IEO by exchange platform, Binance, ZB.COM, DigiFinex, OKEx, Huobi Global, and KuCoin rank at the top of the list. On the opposite end, Hotbit, Probit, Lbank, Bittrex, Bitforex, CoinBene, EXMO, Coinsuper, Bgogo, and BitMart offerings have a negative net ROI.
IEOs provide excellent opportunities for investors, exchanges, and projects. In turn, they are becoming an increasingly important part of the crypto ecosystem. Although users in countries like the United States cannot participate in most of them yet, such collaboration between exchanges and users bring more credibility to the altcoin space, which could, in turn, weigh the scales towards more positive regulations for everyone.
Remember that despite being an attractive option, IEOs do not come with guaranteed returns, so be careful and responsible with your hard-earned money.