IDOs are born after ICO and IEO and are considered the new frontier of fundraising in the crypto world, as they can cover both shortcomings and be available on DEXs.
An IDO is one of the fundraising methods for a crypto project. It is a kind of merger between ICO and IEO with the addition of service: being available on decentralized exchanges (DEXs).
An IDO is launched through a series of automated operations carried out by smart contracts to acquire funds to invest in the project’s development. The funds raised are used to create tokens and a liquidity pool (LP), and the remaining part is distributed among the team members.
The distribution phases of an IDO depend on the DEX, but there are common aspects, for example the project's team offers a token supply at a fixed price on a DEX, and investors block their funds in that DEX for these tokens. First, investors must register for the whiteliste, and then they can receive tokens during the Token Generation Event (TGE).
After this event, tokens are sent to the users that can trade into the liquidity pool.
Unlike the IEO, IDO operates on decentralized exchange and therefore does not need to carry out KYC, and searches are up to the individual.
To participate in an IDO, you must have a crypto wallet that can connect to a dApp like MetaMask and some cryptocurrencies to buy tokens and pay transaction fees.