ICO

An Initial Coin Offering is a fundraising method where a project sells newly issued tokens to early buyers. Participants usually contribute established cryptocurrencies or fiat and receive tokens that may provide utility, governance rights, network access, or purely speculative exposure depending on the project.

ICOs commonly involve a whitepaper, token economics, sale terms, contribution addresses or smart contracts, and a distribution schedule. Some sales deliver tokens immediately; others vest, unlock later, or depend on the network launch.

ICOs are high risk because buyers often fund teams before software, users, revenue, or regulatory status are proven. Common problems include weak custody controls, misleading marketing, unaudited contracts, insider allocations, failed roadmaps, and outright fraud.

Regulatory treatment varies by jurisdiction. Many authorities analyze ICOs under securities, commodities, consumer protection, tax, and anti-money-laundering rules, especially when buyers expect profit from a team's efforts.