Opinion by: Darius Moukhtarzadeh, research strategist in 21shares
A new wave of crypto recruitment is emerging, changing how web3 projects are launching and who can invest in an early stage: community sale. At first glance, community sales may seem reminiscent of the ICO (initial coin) from 2016–2017. However, they represent a significant evolution that is better aligned with the major crypto values of democratization, transparency, and inclusivity.
The projects should include community sales as a key element of their fundraising approach, in addition to increasing from angel and VCS investors. Professional investors should embrace community sales as they greatly increase the chances of sustainable success of web3 projects.
The ICO period
The original ICO Boom promised the widespread participation of retail and democratic investment opportunities previously reserved for well -connected insider. Lack of clear frameworks of regulation has led to widespread fraud, pulling rugs, and market manipulation. This chaotic environment, extensive exploitation, and uncertainty in regulation eventually forced projects to renounce ICOs, moving rather than private cycles that can access the good angels and the adventure capitalists.
Problems with private funding
While private funds initially brought more need of stability and credibility, it also introduced new problems. Over the past two years, many tokens have launched an extremely high FDV (fully melted appreciation) with a low -moving token supply. These tokens entered into exchanges with most of the supply locked and highly appreciated in heaven, which did not achieve the demand. Retail investors, attracted by initial Hypeoften became collateral damage. The result? Damaged tokens and broken trust. Most of these tokens are unlikely to be recovered. This market is discouraging investments in new projects and suspected community development efforts, which weakens the overall maintenance of web3 projects.
Airdrops as an unstable alternative
Airdrops have emerged as another alternative, designed to distribute tokens broadly and spark interest in the community for a project. Airdrops Often fail to make a meaningful, sustainable relationship. Instead, they often become targets for Sybil attacks that use multiple accounts to maximize tokens obtained or airdrop mesenaries obsessed from a project to the next, quickly throwing tokens, depressed prices and slowing down project credentials. If there is no real financial promise and interest in the project beyond the Airdrop, recipients have no incentive to hold tokens or to actively participate in the community.
Community Sale as new Cool Kid on Block (Chain)
Community sales represent a practical, strategic alternative to private funding and token airdrops, which offers a structured way to engage in retail investors that are meaningful and clear. Modern community sales on platforms such as Legion and Echo feature stable regulation of frameworks, with a thorough KYC and AML process that ensures compliance with regulation and security. Inclusive fundraising opportunities require participants to make real capital promises, even moderate, cultivating the true interest of the stakeholder and reducing short-term speculation.
Recently: Blockchain requires great use cases for AI agents: X spaces recap with VCS
One of the most significant advantages of community sales is their ability to democratize access. Investors get admission under equal terms, similar to or sometimes more than previously reserved for adventure capitalists. With the minimum investment often less than $ 100, community sales encourage widespread participation, helping to produce a truly decentralized and focused investor base. Financial investors are more likely to be long -term holders and active members of the community.
Win-win for projects, other investors, and the community
For web3 projects, community sales offer deep benefits beyond immediate capital increase. Early community involvement leads to a more distributed investor base, reducing the risk of concentration and diverse users in the future. Projects with widely distributed tokens continue to show more stable prices, increased community activity, and healthy onchain relationships.
Community sales will significantly enhance reputation in the market of a project. Transparent, Inclusive Fundraising embraces a clear market signal and prospective users – the project appreciates the cooperation and involvement of the community in taking the value. This transparency builds indigenous evangelism, drives organic growth, and creates a honest community base dedicated to the project’s ongoing success. Professional investors should embrace community sales and actively encourage their portfolio companies to provide the community.
The broader crypto market benefits greatly from a move to community sales. Projects that raise funds clearly and inclusively from their communities tend to attract more stable, supporting investor bases. This stability positively affects token markets, reducing volatility, restoring investor confidence, and accelerating greater adoption and integration of blockchain technologies into daily financial services and application.
Community sales represent more of a resurrection of ICOs. They mark a mature approach, combining the early crypto ideals with today’s regulation clarity and technological possibilities.
Projects focused on the community sale position themselves for the initial success in funding, endurance of market stability, and community loyalty. The crypto ecosystem, established on the principles of decentralization and inclusivity, should embrace this model to fulfill its potential. The founders should, if possible, include the community when raising capital, as in the latter, all wins: Wagmi.
The views and opinions expressed in this article are my own and do not reflect the views of my employer, 21shares, or any affiliate organizations.
Opinion by: Darius Moukhtarzadeh, research strategist in 21shares.
This article is for general information purposes and is not intended to be and should not be done as legal or investment advice. The views, attitudes, and opinions expressed here are unique and do not necessarily reflect or represent the views and opinions of the cointelegraph.
