Initial Token Offering (ITO)

An initial token offering (ITO) is a fundraising event in which a project sells newly created tokens to the public, usually in exchange for established cryptocurrencies such as ether or bitcoin. The term is largely interchangeable with initial coin offering; some projects preferred "token" to stress that they were issuing tokens on an existing blockchain rather than launching a new coin, or that the token had a use within a product, like a utility token, rather than being an investment. Regulators generally look at what is actually offered rather than the name: in the United States, for example, the Securities and Exchange Commission has treated many such sales as securities offerings. ITOs carry the same risks as other early token sales, including failed projects, fraud and loss of the entire amount invested. Also see token generation event.