Every year, developers launch exciting new crypto projects, typically with investor backing. Many project founders need capital to innovate and grow continually, while investors want to cash in on profitable crypto ventures.
A crypto launchpad is a place where crypto founders and investors can interact. These platforms help founders raise funding and increase brand awareness while introducing investors to promising new ventures.
In this guide, we’ll cover the basics of crypto launchpads, explain how they work, and discuss seven of the best available platforms.
What Are Crypto Launchpads?
A crypto launchpad is a platform for introducing new projects to raise funding. These platforms deliver early-stage crypto offerings to investors before making them publicly available.
Founders can use these platforms to cost-effectively promote their ventures to diverse investor pools. In fact, many crypto launchpads require founders to pay little to no initial fees.
Investors, on the other hand, can use a crypto launchpad to browse the latest cryptocurrency projects, buy large sums of tokens for a low price, and potentially sell them for a massive profit.
For example, early investors who bought bitcoin in 2012 now have high-stakes ownership in one of the most popular assets in the world.
Fortunately, joining a crypto launchpad is simple.
Users must create an account and undergo Know Your Customer (KYC) authentication, using their personal information and IDs to establish their identity. KYC promotes transparency and security, making it nearly impossible for someone to make transactions with multiple aliases.
After approval, investors can browse current projects and view details like the project’s start date and price before investing. They can also purchase specific tokens once the sale begins. However, the particular method of distribution varies when it comes to token issuance.
It all depends on the type of crypto launchpad you’re using. For example, IDO launchpads sell tokens directly on a decentralized exchange. On the other hand, ICO launchpads support crowdfunding efforts, meaning investors may not receive immediate liquidity from their tokens.
Types of Crypto Launchpads Based on Offering
Crypto launchpads offer numerous benefits to investors and founders, but not all are the same. Here are the main types of crypto launchpads based on their offerings:
IDO Launchpads
An initial DEX offering (IDO) launchpad allows businesses to launch tokens directly on a decentralized exchange (DEX). This type of launchpad opens up investment opportunities to anyone interested, and since tokens can be immediately traded, it also provides greater liquidity.
Investors trade native platform tokens, such as BNB or Ethereum (ETH), for the newly launched tokens through a preset sale method, like a lottery or auction.
IEO Launchpads
An initial exchange offering (IEO) launchpad is a product created by an existing crypto exchange, and it differs completely from an IDO. Unlike IDOs, which are designed specifically for promoting token sales, IEOs act as intermediaries between projects and their investors.
Specifically, the IEO vets each project rigorously before allowing it to raise capital on the platform. For example, Binance Launchpad has a strict application process for new crypto ventures, which helps to bolster the legitimacy and outlook of accepted projects.
ICO Launchpads
An initial coin offering (ICO) is one of the earliest launchpads in the crypto industry. It’s an unregulated way of raising funds for a cryptocurrency project, equivalent to an initial public offering (IPO).
Investors can buy an ICO and receive a token related to the project. This token can either represent a stake in the project or hold some utility value. Unlike IDOs and IEOs, initial coin offerings are completely unregulated, so investors should approach these opportunities with extreme caution and due diligence.
Benefits of Crypto Launchpads
Crypto launchpads provide stellar benefits for both project founders and retail investors, including:
Faster Launch Process
Crypto launchpads provide a structured fundraising environment that significantly refines and streamlines the launch process, reducing the time from concept to market. This allows project founders to capitalize on their ideas with a lower upfront investment and barrier to entry.
Access to a Larger Pool of Investors
Cryptocurrencies aren’t tied to specific countries, and the crypto market spans the entire globe. This means that project founders can attract a global pool of investors and unlimited fundraising opportunities without geographic barriers.
Marketing and Exposure
A crypto launchpad gives prospective projects worldwide exposure and increases brand awareness. Many also offer post-launch marketing and business development services to help ventures thrive.
Regulatory Guidance
Crypto laws and regulations continuously evolve and vary significantly by country. A crypto launchpad will offer regulatory guidance and support to founders who are launching crypto projects to a worldwide audience. Project founders can then ensure compliance in each jurisdiction they’re targeting.
How Do Crypto Launchpads Work?
Crypto launchpads are designed to connect new project founders to vibrant investor communities. Here is a rundown of how they work:
1. Project Selection and Vetting
To protect investors and improve buyer confidence, crypto launchpads are very selective about projects they onboard. These platforms use rigorous selection processes to determine the legitimacy and potential of new crypto ventures.
For example, KuCoin Spotlight, a popular crypto launchpad, is known for its strict selection process for crypto projects. With more than 20 experts, three independent review teams, and four application levels, KuCoin claims that only 10% of candidates will pass their review process.
2. Fundraising Mechanisms
Crypto launchpads offer multiple ways for projects to raise capital, including:
- Fixed token sales: Investors can buy tokens at a predetermined price.
- Auctions: Investors can make competitive bids to acquire tokens.
Each project can choose the fundraising method that makes the most sense for its offerings, needs, and situation.
3. Marketing and Community Building
Launchpads stand to benefit when crypto projects perform well, so many assist projects with marketing and community-building initiatives like:
- Social media marketing
- Influencer marketing
- Live hosting events
Since a launchpad is highly invested in ensuring the success of a new project, it will spend valuable time and resources creating exposure and generating interest.
4. Token Distribution and Liquidity Management
After a successful fundraising round, launchpads will immediately distribute tokens to investors. IDO launchpads even offer initial liquidity on DEXs. This makes it easier for investors to buy and sell the tokens, and project stakeholders don’t have to execute these tasks themselves.
7 Popular Crypto Launchpads
There are many crypto launchpads available to project founders and investors. However, these seven stand out for their transparency, community engagement, and token liquidity.
Binance Launchpad
Binance Launchpad is an IEO created by the world’s largest crypto trading platform, Binance, and it has raised over $180 million for 92 projects. It’s an efficient and secure platform for crypto ventures to raise capital.
After a project’s launch, Binance also provides substantial liquidity, robust security measures, comprehensive listing support, and multiple trading pairs. They are completely committed to ensuring the success of projects they deem worthy of their platform.
Polkastarter
Polkastarter is a decentralized crypto fundraising platform. It allows blockchain teams and companies to raise seed funding on the Polkadot network and launch projects to the public.
Polkastarter is a low-cost platform that’s designed for cross-chain token bids and pools. Founders can launch projects on multiple blockchains, including:
- Ethereum
- Binance Smart Chain (BSC)
- Polygon
- Celo
- Avalanche
Cardstarter
Cardstarter is a decentralized swapping platform and accelerator built specifically for the Cardano blockchain. It connects Cardano innovators with early-stage investors.
This unique platform was one of the first to provide an insurance fund to investors, ensuring that community backers are protected from financial loss. In addition, Cardstarter allows projects to raise funds without deployable smart contracts via token vouchers.
This way, developers can pour all their resources into innovation and streamline the fundraising process.
Seedify
Seedify, also known as Seedify.fund (SFUND), connects startups to resources in blockchain gaming, NFTs, Web3, Metaverse, and other technologies. This decentralized finance (DeFi) platform offers marketing, community development, and funding to new blockchain ventures.
Seedify uses a play-to-earn model, which means gamers can earn tokens and even NFTs as rewards for playing video games.
BSCPad
BSCPad is a decentralized launchpad that enables users to launch projects, raise liquidity, and distribute tokens to investors. It’s built on the Binance Smart Chain (BSC) network to deliver lightning-fast transaction speeds with low fees.
This is the first decentralized IDO for the BSC. Its mission is to provide distributed rewards for all participants through either a lottery tier or guaranteed allocation.
Generally speaking, BSCPad stands out because it doesn’t distribute allocation spots on a first-come, first-served basis. Instead, the platform uses a two-round system that makes garnering rewards fair and equitable for everyone.
KuCoin Spotlight
KuCoin Spotlight allows potential investors to participate in early-stage crypto projects. The popular altcoin exchange promises to vet and select only the most promising projects on the market.
According to its official website, KuCoin Spotlight has achieved the following feats:
- Hosted 26 token sales to date
- Raised over $48 million for listed projects
- Delivered an average ROI of nearly 40x original investments
As a result, KuCoin Spotlight is one of the leading CEX launchpad platforms in the world.
GameFi
GameFi is a crypto launchpad designed for NFTs, eSports, and Metaverse gaming projects. The platform has a dedicated play-to-earn community for game development projects.
GameFi offers an unparalleled level of community support for blockchain-based IDOs. They promise to deliver an entire ecosystem of partners to support projects with pre- and post-launch marketing campaigns.
AlphaPoint Makes It Simple To Launch Your New Crypto Projects
Crypto launchpads serve as incubators for early-stage projects and promising blockchain-based ventures. The premise is simple — these platforms connect aspiring projects with investors eager to participate.
Financial institutions can take advantage of this growing sector by creating their own digital asset infrastructures. But instead of building the software from scratch, they can rely on the battle-tested technology AlphaPoint offers.
AlphaPoint provides a complete suite of white-label crypto solutions. From our tokenized assets platform to our brokerage software, we empower financial institutions to easily enter the crypto market.
Request a demo today to see how AlphaPoint can help you effortlessly create and launch your own crypto exchange.
