Cryptocurrency has taken a front seat in innovation and efficiency in the ever-growing digital world. Crypto developers have designed various fundraising models and crowdfunding initiatives to help businesses and young systems increase cash and nurture their ventures to yield extra awareness and appeal to early investors.
These fundraising systems help a variety of business enterprise entities to increase the yielding of profit. Notably, the most popular fundraising model in the crypto space is the Initial Coin Offering (ICO).
Users of this model reward their traders with a cryptocurrency token to fund the platform. Aside from the Initial Coin Offering (ICO), other brilliant fundraising initiatives include the Initial Exchange Offering (IEO) and the Initial Dex Offering (IDO).
However, with the increasing popularity of blockchain technology, a new fundraising model has emerged and is quickly gaining traction in the crypto space. This new model is called an Initial NFT Offering (INO). This article will explore what an INO is, how it works, and its advantages, but before that, let’s explain the concept of crowdfunding.
Understanding Crowdfunding
The concept of crowdfunding revolves around raising funds for various business purposes. In general, a cryptocurrency project will be available on the interest, and anyone willing to contribute to the project can actively engage and invest in it. This trend is being used by many crypto entrepreneurs and aspiring startups to generate early-stage funding for their business ideas.
Crowdfunding can be done in various ways, but the most common is through an Initial Coin Offering (ICO). ICOs have been widely popular in recent years and have helped many businesses raise the necessary funds to get their work off the ground.
An ICO usually works by businesses offering investors a new cryptocurrency token in exchange for funding the platform. These tokens can now be used to access the services or products provided by the business.
The Initial Non-Fungible Token Offering, or INO, is the most recent addition to the fundraising approach. Created specifically for decentralized platforms, many crypto experts with prior experience in the field view it as a better strategy.
What is Initial NFT Offering (INO)
An Initial NFT Offering (INO) is a fundraising model that allows businesses to issue digital assets for funding. This new model has emerged due to the increasing popularity of blockchain technology and non-fungible tokens (NFTs).
Unlike ICOs, IEOs, and IDOs, which raise funds in fiat or cryptocurrency, INOs raise funds in the form of non-fungible tokens (NFTs).
Non-fungible tokens (NFTs) are blockchain-based cryptographic assets with unique identification codes and metadata that differentiate them from one another. They cannot be traded or exchanged at equivalency, unlike cryptocurrencies.
NFTs, include ownership information for easy identification and transfer between token holders. Owners can also include metadata or asset attributes in NFTs.
One advantage of Initial NFT Offerings is that they make it simple to launch an NFT project. INOs are responsible for the rapid expansion of the NFT space and the number of NFT projects now offering NFT collections.
How Does Initial NFT Offering (INO) Work?
The process of an INO is relatively simple. Businesses issue digital assets, in the form of non-fungible tokens (NFTs), to investors in exchange for funding.
Many NFT platforms allow their users to create Initial NFT Offerings for their community. The NFT platforms enable their communities to vote for good and promising projects published on the platform, and the winners get rewarded with the NFTs.
Developers and upcoming projects provide technical documents and future roadmaps to their community at the start of this race, giving the devs more openness and publicizing their work.
In order to list a project on a platform, creators must implement a First-Come-First-Served or lottery model to allocate their work fairly while increasing community engagement.
Typically, platforms grant access to digital work based on their users’ number of crypto tokens. Users are encouraged to stake crypto tokens to obtain allocations from upcoming projects. Members in the higher tiers of the INO receive rare non-fungible tokens for each project.
Artwork, games, videos, fashion accessories, music, photographs, and metaverses are among the digital assets sold during the fundraising process.
Furthermore, some platforms offer an Initial Staking NFT Offering, or ISNO, a modified version of INO. ISNO involves the sale of limited edition stake-able non-fungible tokens. The concept behind ISNO is to offer a more exclusive and valuable NFT to users who are willing to stake crypto tokens for the development of the project.
Developers design specific staking pools and launch digital assets directly on the platform with varying rarity and burning periods. The ISNO then enables each holder to burn their assets and release the crypto tokens. The owners and creators receive a portion of the staked reward on some platforms.
These NFTs can be bought and sold on decentralized exchanges (DEXs) and can also be used to access the services or products offered by the business. For example, an NFT could be used to access a virtual world or to purchase a digital asset.
Advantages of Initial NFT Offering (INO)
New supporters are diving into the NFT market, resulting in the massive adoption of NFTs. As a result, the number of NFTs is increasing, coincident with a push in INOs, providing plenty of advantages for the market of NFTs. The advantages include;
- Transparency– NFTs are immutable and transparent, thanks to decentralized ledger technology (DLT). The characteristics of NFTs make them ideal for use cases such as digital art, gaming, and collectibles.
- NFTs are easy to trade and transfer. Initial NFT Offerings enable people to earn a living without difficulty by utilizing various digital assets. Users with little understanding of the NFT space can reach out to a wide range of audiences with the help of INOs and crowdfunding. Artists who intend to put together these initiatives can financially fund them by increasing desired tokens through INOs before starting the projects.
- Reduced transaction costs– They have reduced transaction costs while increasing funding returns. INOs with distinct features encourage customers to pay less for transactions. Reduced transaction fees are a boon to innovators and developers, as NFT offerings help to limit transaction fees. The more significant budget returns get linked to the restrained transaction expenses. Initial NFT Offerings provide traders with an advantage due to the inherent scarcity of NFTs.
- High investment returns– They have high investment returns. Regarding ROI, INOs offer better results than traditional fundraising methods. In the case of successful projects, the return on investment for early backers is significantly higher.
- Enhanced liquidity– They offer enhanced liquidity to the project. By releasing a limited number of NFTs, the project can control the price while providing liquidity to early backers.
- Improved engagement with the community– They offer improved engagement with the community. Backers can show their support for a project by participating in the NFT sale. In addition, they can also stay updated on the project’s progress and receive exclusive benefits.
- NFT lending– NFTs can be used as collateral for lending. This is because NFTs are digital assets stored on a blockchain. Lenders can use NFTs to secure loans and earn interest on their investments.
Features of the Initial NFT Offering (INO)
Below are some features that make the Initial NFT Offering platform the best of all fundraising platforms.
Security features– The security of the Initial NFT Offering platform is ensured by the use of,
- 2FA, Authenticator– Allow advanced security features such as 2 Factor Authentication, Google Authenticator, Re-Captcha, and others to help users secure their accounts on the platform.
- Encryption– The platform uses AES 256 encryption to encrypt data in transit and at rest. To ensure data integrity, PII data is also encrypted. Depending on demand, more encryption standards can be customized and integrated.
Application features– The Initial NFT Offering platform can be used for a wide range of applications, such as
- Milestone Contract– The platform’s milestone feature is an exceptional yet optional feature that enables legitimate INOs to differentiate themselves from frauds and thus attract the right investors. Furthermore, this will assist investors in regaining trust in the INO.
- Investor Management– The platform allows for simple management of prospective investors acquired through multi-channel INO marketing campaigns delivered across various crypto ad networks and the crypto community.
Platform Features– The platform has a wide range of features that make it the best fundraising platform.
- Custom Smart Contract– With just a few clicks, you can facilitate flawless airdrops, bonus transfers, refunds, and more by designing custom smart contracts to govern everything on your INO sale.
- Airdrop Campaign Management– Controlling user incentivization allows you to connect with your target audience, build communities, and raise awareness while also efficiently managing your airdrop campaign.
- Detailed Reports and Analytics– You can easily track your INO performance using a single reporting dashboard that provides access to automated reports, basic and advanced report insights, real-time alerts, etc.
Conclusion
Initial NFT Offering (INFO) is a fairly young crowdfunding offering in which tokenized assets in the form of NFTs are sold on the INO platform during the early stages of a project or business. INOs make it easier for firms and artists to sell their NFTs while incentivizing and rewarding investors and communities.
INO is a current solution for getting to the bottom of people’s problems. It enables NFT liquidity, simplifies the recording process, eliminates adherence risks, and provides a safe passage for users.