What is an IGO?
IGO stands for Initial Game Offering.
It's similar to ICO – Initial Coin Offering and IDO – Initial DEX Offering.
It’s a presale of tokens (available to pre-selected buyers) before they are listed on an exchange.
While ICOs and IDOs can be for any type of token/project, IGOs, as the name implies, are only crypto games.
The purpose of the IGO is to raise funds for the next stages of the game’s development, marketing, etc. This means investing at a very early stage and of course, this carries some risks as there’s no guarantee that the project will be completed or successful.
However, the benefit of investing so early is that you’re buying the token at the lowest possible price and as a result, you can expect the value of the token to go up significantly (5x – 60x in my experience) within the first 48 hours... and potentially even more in the future.
The main rule of making big gains (percentage-wise) in crypto is getting in early, before the price pumps… and you cannot get into a project any earlier than this (unless of course, you are one of the devs;).
You can find upcoming IGOs on launchpads.
Launchpads are platforms designed for, well, launching new projects. They can be on different blockchains - Ethereum, BSC, Cardano, etc.
Some may have games alongside other projects, while others are focused purely on games. They may have different criteria for accepting new projects and for the potential buyers to get whitelisted (being able to take part in an IGO). Also, some are likely to have more projects listed than others.
There are many different launchpads but below are a few examples.
From my point of view, the four main criteria for selecting a launchpad are:
1. How frequently they launch new projects?
2. What are their criteria for a guaranteed allocation? How much it will cost me i.e. how many launchpad tokens do I have to purchase to have a guaranteed allocation in an IGO.
3. What is the pool weight for each tier? The pool weight is your ‘slice of the pie’. It varies with each IGO (depends on how many investors are in the pool, at what tiers and how many tokens are for sale) but you can expect the bottom tier (weight 1-2) to be able to invest sometimes only around 20-30 USD in each IGO, while the top tiers might be able to invest around 3,000-5,000 USD.
This means that at lower tiers you certainly won’t become a millionaire anytime soon ;-). That’s the downside of pools that have a relatively low entry for guaranteed allocation – they are very attractive and have a lot of members.
But as you can get 30-60x gains, you can turn for example 20 USD into 1,000 USD quite easily, which is still pretty cool
4. Which network (blockchain) it’s using? While the price of the tokens in an IGO is low, you have to remember that there’re still gas fees to consider. For example, Binance Smart Chain or Polygon have much lower fees than Ethereum.
There’s only one way - your wallet address must be on a whitelist, which is usually published a few hours or maybe a day before an IGO (for example on launchpad’s Telegram channel).
How to get on the whitelist? There are two methods:
Winning a spot in a lottery is pretty self-explanatory ;-).
Sometimes the lottery is completely random, in other cases, holding a certain amount of launchpad tokens gives you higher chances of winning. For example, this is the case with Game Fi and Trust Pad.
Having a guaranteed allocation is probably what most of us are interested in. It’s usually quite straightforward – you just need enough launchpad tokens in your wallet to qualify for a particular tier. The downside is that the amount is usually quite high, especially for larger allocations.
In this section, I will compare four launchpads (Seedify, Game Fi, Trust Pad and Enjin Starter) and the tiers they offer.
Please bear in mind that over time, launchpads may change their tiers and of course the prices of their tokens will also change.
As you can see, you need between 250 and 100,000 SFUND tokens to participate in an IGO on Seedify and there are 9 tiers.
Only Tier 1 is a lottery. From Tier 2 onwards (1,000 SFUND) you have guaranteed allocation in every IGO.
SFUND token currently trades around 4.3 USD, although it was around 5.3 just a few days ago. At current prices, this means an investment of 4,300 to 430,000 USD for guaranteed allocations. It’s a lot of money but a few good IGOs can make it worthwhile.
Also, the prices of many tokens went up a lot recently. I was talking about SFUND on my YouTube channel and Twitter when the prices were between 2.9 and 3.3 USD (so it’s worth following me there;-) and during the summer market pullback you could easily get it for around 0.3 – 0.6 USD. This means that it was possible to get Tier 3 with around 1,000 USD!
As you can see, Game Fi has a slightly different approach – only 4 tiers and only the top one has guaranteed allocation. You need between 20 and 500 GAFI tokens, which at the current price of GAFI (68 USD) means anything between 1,360 and 34,000 USD.
Every 20 GAFI tokens give you one ‘lottery ticket’ so although tiers 1-3 are all lottery, tier 3 gives you a 20 times better chance of getting on the whitelist.
Also, as it’s a lottery, the number of spots on the whitelist is known in advance so individual allocations are known upfront and higher than in the case of, for example, Seedify.
Tier 1 (Rookie) of Game Fi is similar in allocation to Tier 3 of Seedify, and Tier 3 (Pro) is similar to Tier 7… but, it’s a lottery so you never know if you’ll be able to participate in an IGO.
Trust Pad has 9 tiers and as you can see they’re a combination of lotteries with various weighting and guaranteed allocations.
TPAD token currently trades around 0.46 USD (although you could get it for as little as 0.07 during the summer), so you need an investment of at least 1,380 USD to participate in the lottery or anything between 5,520 and 85,100 USD to have a guaranteed allocation.
Trust Pad is not focused purely on games but there’s still a good number of IGO using it.
Enjinstarter has yet another approach. 75% of the pool (the tokens which will be available in the IGO) is reserved for guaranteed allocations split between 3 tiers.
To participate, you have to hold between 25,000 and 500,000 EJS tokens, which at the current price of 0.13 USD amount to 3,250 – 65,000 USD.
What’s different is that the remaining 25% of the pool is available to anyone who has at least 1 EJS token in their wallet.
This is on the first-come, first-served basis, so it’s not the best solution but it’s nice that there are options available for those who may not necessarily be able to invest thousands into a launchpad coin.
So how an IGO works in practice? This example is based on a recent launch of Bloktopia on Seedify.
All upcoming IGOs are listed on Seedify’s website so you can see when the next one goes live. Private sale is for Tier 6 and above and public sale is for all other tiers.
A few hours before the launch a whitelist is published on Seedify’s Telegram. If you have enough SFUND tokens in your wallet and you connected your wallet to Seedify launchpad previously, your wallet address will be on the whitelist.
You can also see how much you can invest depending on your tier. These numbers will vary for every IGO. Also, make sure you have enough tokens (in this case BUSD) to purchase tokens during IGO.
In the same message, there will be an information when exactly the IGO is taking place.
You won’t have to rush as the window is usually 2-3 hours and your allocation is guaranteed (in this example) but you have to make sure you can access your computer in that window, otherwise, you lose your allocation.
Once the IGO is live, you simply go to Seedify website and connect with your MetaMask. You will then have to authorise the transaction and pay gas. As it’s on BSC, the fees are very very low – but make sure you have some BNB in your wallet to pay for it!
If not all IGO tokens sell, there will be a second phase the next day. This one is on a first-come, first-serve basis and the remaining tokens sell out in a couple of minutes max. You may need to increase your gas fee to have a chance.
In that original message on Telegram, there will be also information when the token will be listed on an exchange and what is the vesting period. In the example below, you can see that you will receive 10% of your tokens once the IGO is completed, then 20% per month for the next 3 months and the remaining 30% in the final month.
This also varies for each IGO. Sometimes it may be 50% once the IGO is completed and 50% after one month. The slower the release of tokens, the more stable the price as people can’t just dump them all immediately.
On the day of listing the token on the exchange, you will find the following info on Telegram.
Once you add this contract address manually to your MetaMask (pay attention of the network – the IGO was on BSC but this is a Polygon token so you have to add Polygon network to your MetaMask), the tokens will automatically appear in your wallet.
Of course in this case, you will only receive the first 10%. The rest will be transferred after one month etc.
Once the token is listed on the exchange, you can monitor the price and decide if you want to hold it or sell it.
In my experience, every IGO is generating profit straight away. For this IGO, I was only Tier 2 so could invest only 20.39 USD but BLOK token went up in value around 60x within the first 48 hours after listing.
In other words, I could sell my 10% stake (so 2 USD worth of tokens) for 120 USD. It didn’t make me a millionaire but it’s not a bad result ;-) And I still have 90% of BLOK tokens coming in the next few months.
One note – I had to make sure I have some Matic tokens on Polygon network in my MetaMask to pay for gas to sell those BLOK tokens. The fees are very small but still.
Also, it’s important that these Matic tokens are on Polygon network, not Ethereum network in your wallet – some tokens can exist on different networks but you cannot just send ERC-20 (Eth) Matic to Polygon address as you’ll burn those tokens! You can use a bridge but the cost of gas makes it quite expensive.
IGOs present an amazing opportunity to make some serious gains but you have to invest a fair chunk on money in launchpad tokens.
But even with much smaller investment you can still have a reliable source of modest income… at least in a bull market ;-).
But the biggest opportunity (especially at higher tiers as your investment is more substantial) is the chance to get super early into gaming projects, which not only have a great potential for growth but also are a good hedge against bear market. After all, people will not stop playing games when the market crashes ;-)
The content covered in this article is NOT to be considered investment advice.
I’m NOT a financial adviser. These are only my own speculative opinions, ideas and theories.
Do NOT trade or invest based purely upon the information presented in this article.
“This article is part of The Gaming Metaverse Writing Contest hosted by HackerNoon in partnership with The Sandbox.
Submit your #gaming-metaverse story today for your chance to win up to $2000.”