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| Bitcoin Photo by Clifford Photography on Unsplash |
Based in Darien, CT, Ryan Schroeder is an executive with extensive international finance and accounting experience. A particular focus of Ryan Schroeder in Darien, CT, is alternative investments, and he maintains a close watch on market trends in that area.
For those seeking growth investment opportunities, one emerging scenario is the initial exchange offering (IEO), which is administered through a crypto exchange that works on behalf of a startup. This takes the place of its predecessor, the initial coin offering (ICO), which involves participants making contributions via a smart contract.
The advantage of both ICO and IEO approaches is that they offer fundraising avenues free from many of the financial modeling, paperwork, and regulatory restrictions of traditional initial public offerings. With ICOs having become popular in 2017, a major issue was that some offerings were falsely valued. This led to the development of the security token offering (STO), through which asset tokens were backed by underlying securities. This did not end the issue of “inferior companies” being tokenized, however, and investors still sometimes bore the cost of misinformation.
The IEO approach is one that adds an exchange-specific feature to offerings. This means that the exchange is not simply a listing venue but a counterparty that performs due diligence on every project offered for investment. In addition, buyers must be exchange participants and use their exchange-specific account for the purchase. This takes the process from the hands of the companies themselves, who previously acted as fundraising entities, and also helps ensure that anti-money laundering and other regulatory checks are in place.
