What Is an Initial Game Offering?
An Initial Game Offering (IGO) is a fundraising method game developers use to raise capital by selling tokens representing in-game assets or currency.
These tokens are typically sold on IGO launchpads like GameFi and Enjinstarter before the game is published.
Axie Infinity had one of the most popular IGOs in the blockchain gaming industry, raising over $2.9M in November 2020. The platform sold more than 29M $AXS tokens on Binance Launchpad. They are now worth $230M.
The Role of Initial Game Offering in the Gaming World
Like any other fundraising mechanism, IGOs are crucial for investors and developers. Let’s see how IGOs benefit both.
Investors
IGOs provide early investors a unique opportunity to get involved in a game’s ecosystem from the ground up. By purchasing tokens during an IGO, investors can access exclusive content, such as rare items, characters, or other in-game benefits unavailable to the general public.
Besides that, investors get their hands on the game’s native token at a low price, meaning they can profit from selling it on the open market if the game becomes popular.
Developers
For game developers, IGOs offer a way to secure funding without relying on traditional financing methods like venture capital.
They can engage directly with their community, building a loyal user base before the game’s release. This community-driven approach not only helps in raising funds but also generates hype around the game.
IGO vs ICO
IGOs and Initial Coin Offerings (ICOs) are both used to raise capital in the blockchain space, but they have some differences:
IGOs
- Specific to the gaming industry, allowing game developers to raise capital for their projects.
- Tokens represent in-game assets or currencies, allowing early investors access to exclusive content.
- Aim to build a community around a particular game and engage people from the early stages of development.
- Offer a way for developers to interact directly with their audience and receive feedback throughout the development process.
ICOs
- Commonly used by various blockchain platforms to raise capital for development.
- Tokens typically represent governance rights or utility within the project’s ecosystem.
- Often focused on technology or platform development rather than gaming.
- Investors may participate in ICOs to support promising projects and potentially profit from the token value appreciation.
While both serve as fundraising mechanisms, IGOs are tailored specifically for the gaming industry and involve the sale of special tokens representing in-game assets.
Conclusion
In conclusion, IGOs are a method used by blockchain game developers to raise capital for developing their products.
While similar to the more popular ICO, an IGO offers a different investment approach. Buyers receive tokens representing in-game items used in the project’s economy.
