Whether you look forward to funding your project at an early stage or invest in the project before it becomes a mainstream one, crypto launchpads are a great place to look. They allow founders to get access to the funding in a secure and decentralized way.
Due to the nature of the cryptocurrency markets, receiving funding for the early startups, especially in the bear market, has become very difficult. At the same time, many investors have lost significant amounts of capital due to scams, irresponsible usage of funds by founders, and lack of experience of founders in managing the projects. Crypto Launchpads by allowing investors to invest in the deserved projects in the blockchain space can facilitate the funding of the right projects.
By participating in the launchpads, investors gain access to project tokens at a discounted price. Usually Launchpads require KYC (Know Your Customer) checks from both investors and founders. Performing a KYC check, though it seems like a hurdle for some people, helps in fighting against money laundering through the blockchain space.
Benefits for Investors
By conducting a comprehensive check on founders and project team members through third-party service providers, crypto launchpads ensure the integrity and trust on the projects that are involved. By ensuring the rules and distribution via smart contracts, launchpads can allow investors getting tokens at a predetermined date and at an agreed price. Executing via smart contracts removes the role of middleman and makes the process transparent.
Usually, launchpads issue their own native tokens, which will need to be purchased by investors and then, investors can use these and/or other tokens to invest in the projects. If the crypto launchpad gets more interest from the community, even purchasing the native token can be a good investment choice, expecting that other investors will use the same platform to get access to investing.
Benefits for Projects
Gaining access to funding, especially during the early growth stage, is vital for the success of the projects. It allows the company to allocate funds for marketing, development, sales, and management. Launchpads by facilitating the funding mechanism, allow projects to receive capital and further develop. Additionally, by launching through a launchpad, projects and their founders can showcase their product to a wide audience and attract the interest of the various communities, which is essential for the continued growth of the projects. Through word-of-mouth, the projects can gain wider traction in the blockchain space. Axie Infinity, launched on Binance Launchpad, can be considered one of the most successful and profitable projects in the crypto space. Axie Infinity was first available in a token sale between the 3rd and 4th of November 2020, sold for a price of 1 AXS to $0.10. Then, the price increased to levels which created a fortune for early investors, reaching $165 at its peak. At that point it meant that if one invested during the launch and held it until the peak, he or she made a return of 1650 times. Axie Infinity is the biggest blockchain game to date with up to 5 million players. At the very highest, Axie Infinity had up to 8.3 million one-time players in December 2021.
Risks
Though projects pass through certain stages before Launchpads onboard them, still it is worth noting that the crypto launchpads are not risk-free. Investing in early growth projects carries an inherent risk. The reason is that not all projects pass through all stages for the development and deliver a product that adds value to the ecosystem. Though rewards can be extremely high if projects become successful, a rational investor should decide carefully before investing in a project. Usually diversification can be a good aid here instead of investing all capital in one project. Risk to reward ratio should always be taken with caution.
Genius X Accelerator Program and Launchpad
Genius X is a Cardano-focused accelerator program and crypto launchpad that provides financial infrastructure and technological expertise to propel early-stage startups to attain speed, scale, and edge. Genius X encourages innovation and empowers Web3 startups to build impactful and scalable companies.
Thanks to its specially designed wide-range of service offerings, which sets it apart from others, Genius X offers the following consulting services:
- Fundraising and marketing strategy and execution
- Initial Stake Pool Offering (ISPO) and Tokenomics design
- Legal and Bank account support
- Smart contract support
- Business and Product development
- Integration into the Genius Yield ecosystem
Furthermore, by raising the bar even to a higher degree in the cardano space, Genius X introduced the multi-token ISPO. Delegators will get the tokens of five projects by delegating their ADA to a single ISPO. The Genius X Multi-Token ISPO is a solution for giving the community access to multiple projects simultaneously.
Conclusion
In the realm of cryptocurrencies, crypto launchpads have grown to be one of the most popular forms of crowdfunding, helping both new projects and investors. Primarily, Launchpads provide new projects with the resources and exposure that they need from market participants. In response, they also make it easier for investors to access several intriguing early-stage token sales and blockchain projects. Additionally, the KYC procedure conducted usually by third-party service providers helps to protect investors from potential cryptocurrency frauds and scams.