Those who attended in 2017 will likely remember the craze for the Initial Coin Offering (ICO), which saw many new projects emerge – many of which produced staggering returns for attendees within weeks or months.
Although many ICO-funded projects turned out to be duds, a small fraction grew and evolved into the current heavyweight blockchain platforms, including Ether (ETH), Filecoin (FIL), Polkadot (POINT) and Cardano (THERE IS) – each of which is among the 30 largest crypto assets by market capitalization.
The average ICO generated A whopping 1,320% profit for short-term investors, which makes them one of the most attractive investment opportunities in recent years – despite them less than stellar Overall performance in the long term.
But there was one big problem. Not only was it incredibly difficult to accurately gauge the strength of a project due to the sheer number of ICOs and the euphoria in the market at the same time, but it was also next to impossible for ordinary users to secure a place in top-notch ICOs – which is often the case It took luck and connections, or a substantial investment to secure a slot.
The beginning of the changes
This started in 2019 with the Appearance of the Binance Launchpad.BNB).
Although Binance Launchpad arguably boosted the democratic crowdfunding space for cryptocurrencies, it has gradually become less and less accessible. Now, users have to keep exorbitantly large sums of money on BNB to get an appropriate sizing out of their first DEX offers (IDOs) – anything but fair access.
But in the past year a multitude of alternative platforms have emerged, all with one goal in mind: to democratize access to the next generation of crypto projects and protocols. Known simply as Launchpads, these platforms offer a hand-picked and curated list of new projects made available to their users.
The vast majority of this year’s best performing assets have completed the final stage of their token sale via one or more launchpads. These include Project Seed, PulsePad, WagyuSwap, and My Neighbor Alice – each of which achieved a prime return on investment (ROI) of more than 30,000%.
Democratized launchpads distribute access to new opportunities to potentially hundreds or thousands of users, each of whom is either given a chance to participate or is entitled to a guaranteed allotment, depending on the specifics of the platform in question. Because these projects are manually reviewed, they help reduce scams, money theft, and duds.
However, the immense growth of these platforms has begun to be detrimental to users as the size of their assignments gradually diminishes as the number of users increases. Many decentralized launchpads also have their minimum entry bar increasing, with the lowest level on some launchpads requiring an investment of several thousand dollars.
The launchpad industry
Today the launchpad industry is densely filled with different platforms, many of which target projects starting on specific blockchains or in specific sectors / niches. While there are generally a number of platforms providing Launchpad services for each blockchain, some have dominated their respective chains and sucked up most of the quality projects.
As it stands, DAO Maker is currently dominating the Ethereum project landscape and has launched heavyweights such as XCAD Network, Opulous, Orion Money, GameFi, and DeRace in the past few months. BSCPad is generally considered to be the preferred launchpad for Binance Smart Chain projects thanks to recent successes like NFTLaunch, BitOrbit, WagyuSwap and ADAPad.
Other emerging blockchains also have their own standout launchpads, including Solanium, a Solana-centric launchpad that hosted the incredibly successful play-to-earn projects Project SEED, Cryowar, and DeFi Land; and Avalaunch, which launched a number of coveted assets in the Avalanche ecosystem.
BlueZilla, on the other hand, has cast a wide net by developing and operating launchpads across multiple blockchains, including Cardano (ADAPad), PulseChain (PulsePad), and KuCoin Community Chain (KCCPad). This strategy is intended to democratize access to the projects that concretize these new chains.
Launchpads are one of the main reasons Avalanche, Solana, Terra and many other modern blockchains have seen such a Cambrian innovation explosion in the past few months as they provide an easy way for projects to not only secure funding and distribute their tokens, but also to bootstrap their initial user base.
Some are now big enough to be officially endorsed and supported by the native blockchain they support, such as VelasPad – which has partnered with the AI-powered Solana fork called Velas.
Launchpads and the blockchain space
By providing a solid starting point for new projects, launchpads have become an integral part of the blockchain landscape, and the most popular launchpads can have tens of thousands of users.
While launchpads have successfully democratized access to promising investment opportunities, not all launchpads are built equal, and those on the less successful end of the spectrum may struggle to secure high quality projects in the face of increasing competition.
In fact, there are now a huge number of launchpads, but relatively few promising projects. This has resulted in fierce competition between the launchpads as they all battle to secure the best projects for their respective communities. That said, only the most popular launchpads have the community and track record to be picky about their projects, often leaving less established platforms with the lowest quality projects.
As we move further into the bull market, the quality gap will only increase, which could pose a challenge to less experienced traders and investors who may face losses as they entrust their funds to the growing number of lackluster launchpads.
This article does not provide investment advice or recommendation. Every step of investing and trading involves risk, and readers should do their own research when making a decision.
The views, thoughts, and opinions expressed herein are solely those of the author and do not necessarily reflect the views and opinions of Cointelegraph.
Kalani Moe is the director of ecosystem growth at Velas, a decentralized smart contract platform that was divested from Solana. As a serial entrepreneur and early master builder in the blockchain area, Moe previously founded the Divi project and, as a former creative director, helped make CoinPayments the world’s leading payment processor for cryptocurrencies.
