ICO or hybrid token with IR CONSULT

Since 1994 IR CONSULT is a high-specialized capital market consultant
for IPO's and Investor Relations.

The issuance of an ICOs (Initial Coin Offering) or hybrid token can have
a promising use for some companies.
But, STOs are regulated and allow public offerings.

Please look at our website and find out how we can support you.

Direct contacts: post@sto-ico.eu oder +49-6002-92042.

ICO = Initial Coin Offering

Utility-Token are not for Company Financing,

but maybe hybrid token.

With an ICO (Initial Coin Offering), a company issues so-called utility tokens that contain membership rights or purchasing advantages or can even be used to pay for services offered.

However, they are not suitable for company financing, as they do not provide the company with any long-term financial resources. Although the company also receives money through the sale of the utility tokens, this is very often ex-changed again after it has been used, i. e. money flows out of the company again.

Nevertheless, a few years ago ICOs experienced a boom, especially in America and Asia, which also came to Europe for a short time in 2017. A few German companies have successfully collected up to EUR 100 million with ICOs. Since there was no regulation and control, unfortunately also many fraudulent ICOs were issued, whereby investors lost a lot of money.

For this reason, international financial supervisors have banned ICOs from corporate financing.

However, regulated STOs (Security Token Offering) can solve the financing problem of start-ups and small businesses (SMEs) in particular, since the entire capital procurement process is faster, less complicated and less expensive than traditional corporate financing procedures such as venture capital, private equity or even an IPO.

STOs are an alternative worth considering or even often the solution for start-ups and SMEs.

We are happy to answer your questions: mail@sto-ico.eu

or telephone +49 - 6002 – 92042

Is an ICO still useful?

With an ICO, a company issues utility tokens either itself or via an ICO exchange.

This gives the buyer / owner of these tokens predefined advantages:

- Purchase discounts for members
- Pre-emption rights for members
- Payment for certain services

This is, for example, done in the Ethereum world to use and pay the Ethereum blockchain.

Sometimes any Crypto currency (BitCoin, Ether etc.) is necessary for the purchase. It is used to buy the tokens, i.e. money flows to the company. Then the user buys and "pays" for the advantages he uses, and the tokens go to the seller or service provider. However, since all these sellers have their costs in Fiat currencies, they will exchange their tokens very quickly, i.e. the token issuer loses money again.

This makes it clear that utility tokens have never been suitable for long-term corporate financing.

Nevertheless, an ICO may have its  advantages and raison d'être. You can, for example, carry out a STO for corporate financing and at the same time an ICO to be able to offer your customers your services.

So ICOs can continue to make sense.

Let's discuss your wishes!

Together we will find a viable and worthwhile way for your project/company. 


© Copyright 2023 STO-IPO / IR CONSULT - All Rights Reserved