[{"@context":"https:\/\/schema.org\/","@type":"Article","@id":"https:\/\/www.icoclone.com\/blog\/security-token-offering-vs-initial-coin-offering-sto-vs-ico\/#Article","mainEntityOfPage":"https:\/\/www.icoclone.com\/blog\/security-token-offering-vs-initial-coin-offering-sto-vs-ico\/","headline":"Security Token Offering vs Initial Coin Offering: Everything You Need to Know!","name":"Security Token Offering vs Initial Coin Offering: Everything You Need to Know!","description":"ICO and STO are the two crowdfunding platform used to raise your funds. This blog explains the difference between STO and ICO","datePublished":"2019-04-08","dateModified":"2024-02-05","author":{"@type":"Person","@id":"https:\/\/www.icoclone.com\/blog\/author\/icoclone_admin\/#Person","name":"About ICOclone","url":"https:\/\/www.icoclone.com\/blog\/author\/icoclone_admin\/","image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/d4a4929b43daff18b54d316fb678e018?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/d4a4929b43daff18b54d316fb678e018?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"ICO Clone","logo":{"@type":"ImageObject","@id":"https:\/\/www.icoclone.com\/blog\/wp-content\/uploads\/2019\/05\/cropped-logo.png","url":"https:\/\/www.icoclone.com\/blog\/wp-content\/uploads\/2019\/05\/cropped-logo.png","width":224,"height":48}},"image":{"@type":"ImageObject","@id":"https:\/\/www.icoclone.com\/blog\/wp-content\/uploads\/2019\/04\/imgpsh_fullsize_anim-67.png","url":"https:\/\/www.icoclone.com\/blog\/wp-content\/uploads\/2019\/04\/imgpsh_fullsize_anim-67.png","height":400,"width":735},"url":"https:\/\/www.icoclone.com\/blog\/security-token-offering-vs-initial-coin-offering-sto-vs-ico\/","about":["Security Token Offering"],"wordCount":2103,"keywords":["security token offering vs initial coin offering","sto vs ico"],"articleBody":"Over the past decade, cryptocurrencies have become more popular among people. Cryptocurrencies are virtual currencies that are recorded on the blockchain. A blockchain is a distributed ledger that has massive value in the finance industry. Many companies have started incorporating blockchain technology and cryptocurrencies in their business verticals.\u00a0To start any sort of business, you would require a huge amount of funds. In the olden days, funds had been collected using traditional means of crowdfunding like finance, IPO, etc. After the emergence of cryptocurrencies, most startups and crypto preneurs started raising their funds using crypto crowdfunding.\u00a0Crypto crowdfunding exists in various types such as ICO, STO, IEO, IFO, IDO, etc. Among these methods, ICO and STO are more popular. Most people have queries on the difference between STO vs ICO.\u00a0In this article, we shall discuss ICO, STO, and the difference between them. Come, let us dive into the article with\u2026What is an Initial Coin Offering (ICO)?ICO is a cryptocurrency-based equivalent of an initial public offering (IPO). It has been popular since 2017 and many people have raised funds for their business using ICO. ICO is a fundraising campaign where a startup will launch a whitepaper instructing their project\u2019s goal, count of tokens, period, and all other information about a project. Investors who are interested in the project will fund it. Crypto tokens will be offered as a reward by the startups in exchange for the funds raised.\u00a0Tokens offered in ICO are referred to as utility tokens which means that an owner of a crypto token has the right to access products or services offered by the startup. ICOs have reaped a hefty return for both the startups and the investors. Like other crowdfunding methods, there will be no regulations and involvement of central authorities. Hence, ICOs are completely decentralized. As per the expert\u2019s opinion, ICO is considered an ideal method of crypto crowdfunding.\u00a0Benefits Of an ICOIt is an independent platform for raising fundsICO launching cost is low when compared to other methodsIt is very easy to create an ICO websiteNo restrictions on launching an ICOHigh liquidity can be attained within a short timeThere are no prior limits for raising fundsNo government and third-party involvementIt is easy to attract massive investors using ICOThese are the benefits of launching an ICO.\u00a0now, we shall discuss\u2026What is a Security Token Offering (STO)?Security token offering (STO) is quite similar to an initial coin offering as they both are used for raising funds for startups. STO is a regulated method of fundraising where the government bodies issue security tokens. Security tokens are created by backing real-world entities like Bonds, real estate, assets, valuables, etc. Moreover, Security tokens are validated by the SEC and local government regulations should be followed.\u00a0Security token offering offers full ownership over a completely secured blockchain ledger. STO is highly secured as there will be involvement of government authorities. So, more trust will be built among the investors. Other than the regulations, all other processes will be the same as there in the initial coin offering.Benefits Of an STOThe value of assets can be divided into smaller valuesOffers larger liquiditySTO is completely risk-free because of the SEC regulationHigher market efficiencyBuilds great trust among the investorsCuts all middlemen and brokerageNow, you might get an idea about ICO and STO. Yet still, you will be eager to get a clear understanding of the differences between security token offering vs initial coin offering. Come, let us see the\u2026Differences Between STO vs ICO \u00a0 \u00a0 \u00a0 \u00a0\u00a0Initial Coin Offering (ICO)\u00a0 \u00a0 \u00a0 \u00a0 Security Token Offering (STO)In ICO, the fundraising startup will issue crypto tokens for the investors to support with funds for their projects.In STO, security tokens are issued to the investors by following all regulations of the governing body.It is the first crowdfunding mechanism to evolve in the crypto ecosystem.STO was evolved after ICO to enhance full-fledged security for potential investors.Launching an ICO has no barrier to entering, so it is very easy for startups and entrepreneurs to kickstart their projects.The STO launching process is somewhat more complex than the ICO because the startup will verify that there is no compliance risk for issuing STO.ICO is an unregulated form of crowdfunding that doesn\u2019t involve the jurisdiction of a governing body.STO is completely regulated by the Securities and Exchange Commission(SEC) and some local bodies’ regulations also should be followed.Generally, crypto tokens are created using certain token standards, and no assets are backed by ICO.Here, security tokens are created by backing some tangible assets, shares, bonds, valuables, etc.ICO is an independent mechanism where anyone can launch and participate.STO includes high regulations to maintain security. So, it is less possible for everyone to launch STO.These are some of the differences between an initial coin offering and a security token offering. After knowing about ICO and STO, if you wish to launch any of these platforms, certain steps have to be followed. So, let us see\u2026How to Start a Successful ICO and STO?Certain steps should be followed for launching ICO and STO. Now, we shall discuss those crucial steps individually for both ICO and STO.Steps for Launching an ICOHave a phenomenal ideaAnalyze your competitorsSearch for crypto-legalized countriesCreate a crypto tokenDraft a whitepaperDesign an ICO websitePromotion and marketingICO launchBy following these steps, you can easily launch your own ICO website.\u00a0Steps for Launching an STOCertain steps have to be followed for a successful launch of an STO. Those steps are as follows,Hold an extraordinary business ideaFollow the regulationsSketch your whitepaperHave a legal advisory for following the jurisdictionsChoose a renowned STO development service providerCreate a security tokenHave an STO websiteSTO marketing and promotionBy following these steps, one can easily launch an STO platform. You can easily develop your own STO website but a crucial one to be remembered is choosing the esteemed STO Development Service Provider.\u00a0Because the provider will guide you in developing an exemplary ICO and STO website. One such provider in the crypto ecosystem is Icoclone.\u00a0Why Choose Icoclone for ICO and STO Development?Icoclone is a renowned ICO and STO development service provider in the crypto ecosystem. We have great years of working experience in providing ICO script\u00a0and STO development services with great outcomes. We specialize in offering exemplary ICO\/STO scripts with splendid customizable features at an affordable cost. Till now, we have offered more than 100+ premium ICO\/STO scripts for our beloved clients across the globe.Moreover, we have a skilled and well-seasoned team of blockchain developers for developing a high-feature integrated ICO\/STO website. If you wish to launch your ICO\/STO, contact Icoclone promptly to get a readymade ICO\/STO script for kickstarting your crypto business. In our ICO\/STO script, you can add whatever features you need without any hassle."},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"Blog","item":"https:\/\/www.icoclone.com\/blog\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"Security Token Offering vs Initial Coin Offering: Everything You Need to Know!","item":"https:\/\/www.icoclone.com\/blog\/security-token-offering-vs-initial-coin-offering-sto-vs-ico\/#breadcrumbitem"}]}]