What is an Initial Game Offering (IGO): A Comprehensive Guide for Beginners

6 min read

What Is an Initial Game Offering (IGO)?

IGOs, or Initial Game Offerings, represent a crowdfunding approach blockchain game developers utilize to raise funds for their early-stage gaming projects. 

The popularity of IGOs has led to tremendous growth in the blockchain gaming space, with some established blockchain games being valued at millions of dollars. In exchange for investment, early backers may receive discounted in-game assets and tokens before public release. 

IGOs are different from ICOs, as they are focused on the gaming industry. 

According to DappRadar, blockchain games account for almost 50% of all decentralized app activity. 

IGOs are an excellent way for blockchain gaming projects to secure early-stage funding and can appeal directly to their target audience for support. This approach eliminates the need for startups to convince venture capitalists or approach high-net-worth individuals for funding. 

Examples of successful blockchain gaming projects launched via IGOs include Axie Infinity, Aavegotchi, and CryptoBlades, which boast thousands of daily active users. The popularity of IGOs in the gaming industry is on the rise, and they offer a promising opportunity for developers to secure funding and bring innovative blockchain games to market. In 2022, on average, 1.13 million Unique Active Wallets connected to game DApps daily. That’s a 60% increase from the 2021 numbers.

How Do Crypto IGOs Work?

IGOs are similar to Initial Coin Offerings (ICOs) but with a focus on the gaming industry. Participants in an IGO can buy early access to in-game assets such as characters, skins, weapons, and mystery boxes. These assets are often non-fungible tokens (NFTs) required to access or play the game.

To participate in an IGO, you’ll typically need to purchase the launchpad platform’s native token and lock it in a pool for a certain period. Based on the amount of tokens locked, you’ll receive the project’s token or NFTs. IGO launchpads have different setups, but most have a subscription mechanism to select reward winners and ensure equal opportunity.

Examples of IGO launchpads include Binance NFT, GameFi, Seedify Fund, Trust Pad, and EnjinStarter. 

Other Initial Offerings Methods

  1. ICO – Initial Coin Offering – Similar to IGOs, ICOs are a way to raise funds for a new project, but with a focus on cryptocurrencies. In an ICO, investors purchase cryptocurrency tokens to fund the project.
  2. IEO – Initial Exchange Offering – IEOs are similar to ICOs, but the tokens are sold directly on cryptocurrency exchanges. This method can provide more liquidity for the tokens and reduce the risk of fraud.
  3. IDO – Initial DEX OfferingDeFi projects can raise funds through various methods, such as decentralized exchanges (DEXs), liquidity pools, and yield farming. These methods are typically used for more complex financial products and services.

The Most Successful Crypto IGOs Launchpads

Here are some of the most successful crypto IGOs launchpads:

  • Binance NFT: This marketplace allows users to create and trade NFTs. It also has a subscription system that allows everyone to participate in its IGOs.
  • Seedify Fund: A decentralized launchpad that a decentralized autonomous organization governs (DAO). It requires between 250 and 100,000 Seedify (SFUND) tokens to participate. Seedify has nine tiers, and investors can secure seed funding if their projects receive positive evaluations.
  • GameFi: It has four investment tiers, and only one tier has guaranteed allocation to its IGOs. GameFi gives one lottery ticket for every 20 GAFI tokens, which is the minimum participation requirement.
  • Trust Pad: It is one of the safest multichain launchpads and focuses on IDO launchpads. Trust Pad has nine tiers, which are a combination of lotteries, guaranteed allocations, and weighted entries.
  • EnjinStarter: It focuses on expanding the crypto gaming ecosystem within Enjinstarter’s network. It has a unique approach that reserves 75% of IGO tokens for guaranteed allocations, split into three tiers. A holding of 25,000 to 500,000 Enjinstarter (EJS) tokens is required to participate.

IGOs vs. IDOs vs. IEOs vs. ICOs

Vetting ProcessProjects must meet the launchpad’s requirementsNo vetting is requiredThere is a demanding vetting procedure to meet before a project can be listedIDOs don’t always go through a rigorous due diligence process, which might increase the overall risks
FundraiserA percentage of the token supply is available to the public through the exchange launchpadThe project that is launching the ICOThe centralized exchangeThe decentralized exchange
Token Listing After Crowd SaleCentralized exchanges automatically list the tokenThe project will have its tokens on different exchangesCentralized exchanges list the token straight after the crowd saleThe project’s token is launched on a DEX and can be listed almost immediately
Smart ContractThe launchpad and project team manage smart contracts togetherThe project behind the ICO is in chargeCrypto exchange’s responsibilityThe project’s token is launched on a DEX and can be listed almost immediately
KYC/AMLMay vary depending on the platform hosting the IGONoYesNo

Advantages and Disadvantages of IGOs

Advantages of IGOs

  1. Early Access to In-Game Assets: IGO participants get early access to in-game assets, including mystery boxes, characters, skins, accessories, weapons, and other items.
  2. Support for Early Development: By participating in IGOs, investors can support the game’s early development and be part of a community that helps shape the game’s future.
  3. Potential for Profit: Like other cryptocurrency investments, IGOs can generate profits if the game and its assets become popular and in demand.
  4. Transparency: IGOs are conducted on a blockchain, which provides transparency and immutability of the transaction records.

Disadvantages of IGOs

  1. Risk of Scams: As with any investment, IGOs carry a risk of scams and fraudulent projects. It’s essential to conduct thorough research and due diligence before investing in an IGO.
  2. Volatility: The cryptocurrency market is notoriously volatile, and IGOs are no exception. The value of tokens acquired through an IGO can fluctuate widely, leading to potential losses.
  3. Limited Regulation: IGOs are relatively new, and the regulatory landscape needs to be better defined. This lack of regulation can make it easier for scammers to operate and may make it more difficult for investors to seek recourse in case of fraud or mismanagement.
  4. Limited Liquidity: IGO tokens may have limited liquidity, so selling or trading them on the open market can be challenging. This lack of liquidity can limit an investor’s ability to exit the investment if needed.

How to Participate in IGO Launchpads

An IGO launchpad is a platform that allows investors to participate in initial game offerings (IGOs). The process of investing in an IGO on a launchpad involves the following:

  • Connecting a digital wallet to the launchpad.
  • Choosing a tier based on the investment value.
  • Selecting the desired IGO to invest in.

Different launchpads have different criteria and processes for accepting new projects and investors. Some launchpads are dedicated to gaming projects, while others may offer a range of blockchain-based projects.

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