Although fundraising through Initial Coin Offerings (ICOs) is still not accepted worldwide, my personal view is that ICOs have the opportunity to replace investments with Venture Capitals (VCs) or even bring the company into the stock market, considering all the special features built into and offered by ICOs designed to fill gaps in current traditional markets and industries.
Raising funds across the world in the same language – Blockchain
The blockchain network offers everyone the opportunity to invest without having to worry about geographical border restrictions. On one hand, projects and companies offering ICOs can ensure that the ICO is accessible by as many people as possible globally. On the other hand, individuals or entities that want to invest can do so at minimum costs. As most people are used to making financial transactions with commercial banks as a medium, they are no strangers to transaction and exchange fees. With blockchain and cryptocurrencies as the medium of exchange now, investing with minimal fixed costs has been made possible.
Freedom to raise funds with lesser regulatory and structural restrictions
Financial laws and regulations regarding investments (traditional or crypto-related) differ from country to country, and companies and projects are bound by these laws. Some countries such as the United States or South Korea for example have more stringent laws against ICOs and cryptocurrencies. However, ICOs removes the challenge of such legal restrictions as companies can choose to register for ICOs in ICO-friendly countries. Now, if we want to invest in a global company like Facebook, Google or Amazon, opening a trading account or transferring money between countries is a complex and cumbersome process, but ICOs allow us to invest in a global company easily.
Asset, investment, and utility
If investing through crowdfunding, VC or entering the stock market Investors can only own shares to trade on the trading board or receive dividends. Cryptocurrencies on the other hand are more liquid and also have greater flexibility in functions. For example, it can be used to exchange products and services, to facilitate peer-to-peer loans etc. or even secure payments and transfers. Today, cryptocurrency differs greatly from traditional assets and also the traditional stock market. The value of funding through ICOs will increase in the next two to three years and we can see this happening due to greater acceptance of blockchain and crypto now by the general public, and more importantly, by governments and institutions across the globe.