Initial Exchange Offering (IEO)
A token sale conducted directly through a centralized exchange's platform, which vets the project and handles distribution to its own users.
An Initial Exchange Offering is a token-sale model in which a project partners with a centralized exchange to sell its tokens directly to that exchange's user base, rather than running the sale independently. The exchange typically performs some level of due diligence on the project before listing the sale, handles the token distribution and often the initial trading listing, and charges the project a fee or a share of tokens for hosting the offering.
An IEO is distinguished from an Initial DEX Offering (see Kaavon's "Initial DEX Offering (IDO)" glossary definition) in that an IEO runs through a centralized exchange's own vetting and custody, giving buyers some exchange-level screening and a guaranteed listing venue, whereas an IDO runs permissionlessly through a decentralized exchange or launch platform with no centralized gatekeeper. The exchange's vetting in an IEO is not a guarantee of project quality or a regulatory endorsement, and buyers still bear the underlying investment risk of the token itself.
Examples
- An exchange hosting an IEO typically requires users to hold or stake the exchange's native token to gain priority access to the sale.
- Unlike an IDO, an IEO's token distribution and initial listing are both controlled directly by the hosting centralized exchange.