DEFINITION of 'Initial Coin Offering (ICO)' An unregulated means by which funds are raised for a new cryptocurrency venture. ... In an ICO campaign, a percentage of the cryptocurrency is sold to early backers of the project in exchange for legal tender or other cryptocurrencies, but usually for Bitcoin.
ICO (Initial Coin Offering) is the new method acquired by the companies to raise capital for their business through Blockchain technology.
The key difference between an IPO and an ICO is, the investors do not own any shares of the company in ICO. The tokens or coins have nothing to do with the company equity and trade separately on various exchanges.
The money raised in ICOs is spent towards product development, pay salaries, marketing, and other company operations.
Initial Coin Offering is the way for a Blockchain based startup to raise money in crowd sourcing. A Blockchain based company can issue tokens or coins for a certain price in cryptocurrency and public can buy coins for crypto such as Bitcoin. ICOs are the fastest ways to raise funds and ton of it. In year 2018 so far, more than $15 billion have raised in ICOs and the numbers are growing. https://www.jumpstartblockchain.com/article/how-much-money-icos-have-raised/