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IEOs - The Next Crypto Golden Goose?

Check out past issues of the newsletter along with more interesting crypto content as well as our rec

Satoshi&Co Daily Crypto Newsletter

May 23 · Issue #182 · View online
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Check out past issues of the newsletter along with more interesting crypto content as well as our recently-launched podcast series with leading crypto industry participants at our newly-launched website

(Listen to our latest podcast here. It is with Sandeep Nailwal of Matic Network, which is a layer 2 protocol working on ETH’s Plasma. Matic Network recently finished a successful launch on Binance Launchpad and is also the first Indian crypto startup to receive funding from Coinbase Ventures).
While we are clearly witnessing the green shoots of a crypto bull market, ICOs in their new avatar are already making headlines with their dizzying return multiples in just a matter of weeks. We had covered IEOs earlier, and now revisit this topic.
In contrast to the previous-iteration of the by-now well-known ICO model, the IEO (Initial Exchange Offering) model of capital raising aims to address some of the former’s shortcomings and pitfalls. IEOs offer projects the opportunity to tap into exchanges’ existing user base line and also allows them to focus more on project development and spend less resources on the sales, marketing and distribution part of a token offering. Centralized exchanges can to a certain extent also solve the Sybil attack problem where ICO investors have in the past resorted to creating new addresses to get around contribution limits that ICO teams imposed on ICO subscribers, as the cost of creating multiple trading accounts on a centralized exchange is much higher than just creating a new Ethereum address.
The unsavoury side to all this is of course that IEO launchpads are seemingly engaging in pump and dump schemes to simulate trading activity and perhaps even promising price guarantees for IEO projects in a bid to bring in more upcoming projects to the platform. For example, the graph below depicts the post IEO return of the projects that have launched on Binance in the past three months. Tokens of IEO projects have experienced significant surges in prices in the weeks following their launch and then cratered from the peaks abruptly and significantly.
Source: Coinmarketcap
Source: Coinmarketcap
Source: Twitter, Larry Cemark
Source: Twitter, Larry Cemark
Meanwhile in Crypto Wonderland....
“Telecom Giant Now Accepts BTC Payments”
Colossal mainstream telecom provider AT&T announced it now accepts Bitcoin payments for bills, via BitPay. BitPay will now appear as a payment choice when clients pay online or through myAT&T app usage. In the fall of 2018, the crypto space also saw Ohio take a shine to Bitcoin, allowing residents to pay their taxes in the asset, via BitPay. Mainstream adoption for cryptocurrencies is at the doorstep of the industry, with big businesses utilizing blockchain, mainstream entities looking to trade crypto and new entities, such as AT&T, now allowing bitcoin as a payment method.
“SEC Sues a Crypto Ponzi Scheme Operator”
The U.S. Securities and Exchange Commission (SEC) is suing a California resident on charges of selling unregistered securities and conducting a Ponzi scheme disguised as a cryptocurrency. The SEC announced Thursday that it had filed for an injunction against Daniel Pacheco, claiming that he sold unregistered securities through IPro Solutions LLC and IPro Network LLC, giving investors “points” which they could theoretically convert to PRO Currency, a digital asset affiliated with the companies. Pacheco allegedly raised $26 million through the scheme.
“Robinhood Officially Launches Crypto Trading in New York”
As of today, New Yorkers can officially invest in cryptocurrencies on Robinhood Crypto. Currently, you can invest in seven cryptocurrencies on Robinhood Crypto: Bitcoin, Bitcoin Cash, Bitcoin SV, Ethereum, Ethereum Classic, Litecoin, and Dogecoin. You can also track price movements and news for those and 10 additional cryptocurrencies. With New York, Robinhood Crypto is now available in 39 states.
“Russian Central Bank Mulling Over Launching a Gold-backed Cryptocurrency”
Russia’s central bank, the Bank of Russia, will consider issuing a gold-backed cryptocurrency, Russian news agency TASS reports May 23. Elvira Nabiullina, the head of the Bank of Russia, revealed that the bank may be interested in creating a gold-pegged crypto for conducting mutual settlements with global jurisdictions. However, Nabiullina claimed that she believes that it is more important to develop international settlements using national currencies. Speaking at a meeting of the State Duma, the bank’s governor cited a successful example of using national currencies in settlements under the framework of the Eurasian Economic Union (EAEU), noting that the development demonstrated good dynamics.
Tweet of the Day
Brendan Bernstein
Problem with most crypto projects:

They're products for early stage investors' IRR, under the guise of consumer apps to democratize the world

- This is why founders leave pre launch
- This is why projects have more employees than DAUs
- This is why dApps won't scale
Today's Top Reads / Podcasts
Overnight Performance of Top 10 Currencies
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