The crypto space is starting to resemble the fashion world in that influential trends come and go depending on the season. Last year’s buzz surrounded initial coin offerings (ICOs). For those who have been living under a rock or just can’t keep up with all the crypto-lingo (totally fair), an ICO in simplest terms is a way for companies looking to create their own currency to raise money without having to give up the ownership of the company to large VCs. The trend, spurred on by ICO public relations, went viral, as crypto enthusiasts tried to get in on the action in any way they could. After what was globally recognized as the crypto winter, crypto projects and currencies took a downturn, as did ICOs. Just as Juicy tracksuits were left in the 90’s, ICOs are done in the eyes of the media and therefore ICO PR, not to be confused with blockchain or crypto PR, is now a dying practice.
A Dying Trend
Of course, because ICO’s were a trend, they weren’t always on the decline. For much of 2018, ICO’s were responsible for projects raising billions including, Petro and Telegram, to name a few. According to experts, Public ICO sales started to fail significantly as a result of the overall market drop beginning in May 2018. Companies did not have the resources to keep up with their roadmaps or develop their exchange listings. Research also concluded that more than 50% of ICOs failed within just four months and projects lost millions in funding, also subsequently hurting investors. There was a lot of uncertainty surrounding the success of ICOS, which made it difficult for ICO public relations companies to navigate. All this negativity and loss surrounding ICOs is what prompted the birth of new and improved versions like the IEO and STO.
On Trend: IEOs and STOs
As ICOs are, for lack of a better word ‘out,’ IEOs and STOs are those hot new styles everyone wants to be wearing. IEO is the same as ICO, but it utilizes the crypto infrastructure, specifically exchanges, the way ICOs did not, making it more appealing to investors. Running an IE0 enables the possibility of directly using the existing user base of the exchange. IEOs only accept legitimate projects, making it more difficult to scam contributors into engaging in sketchy and fraudulent activities, which was an ongoing worry with ICOs. IEOs also require no marketing or PR efforts as investors are always on the lookout for the top exchanges.
In addition, a Security Token Offering (STO) is also a fundraising method that, unlike an ICO, comes in the form of an investment contract into an investment asset, such as bonds, stocks, real estate opportunities, and/or art. According to Ophir Gertner, STOs have the potential to meet the growing demand for compliance and accountability and fill the void currently facing the market. Companies that sell STOs are essentially selling securities from their own company, and are therefore legally bound to security holders. There is heightened confidence and less risk of security breaches and fraudulent matters with STO’s and IEO’s, ultimately making them safer and on the PR front more desirable to work with.
Is ICO public relations really dead? Well, experts are now saying new regulations could maybe bring the whole ICO trend back once and for all. For now, we will have to wait and see, and continue to witness the latest IEO and STO trends dominating the runway. Who knows, we could start to see juicy tracksuits pop up again during New York fashion week 2020, or maybe a more realistic prediction? The rebirth of the ICO and ICO PR.
