What is an ICO
An ICO is a fundraising event in which a project issues a new digital token directly to subscribers, usually in exchange for BTC, ETH, or fiat. The token is described in a whitepaper that sets out the project’s roadmap, supply schedule, and intended utility. Subscribers receive tokens at the offering price, which may then trade on secondary markets.
ICOs were heavily used during the 2017 to 2018 crypto cycle, including by some iGaming projects. The regulatory framework around ICOs has tightened significantly since then. In the US, SEC enforcement actions have classified most ICO tokens as securities under the Howey test. In the EU, MiCA imposes prospectus-style requirements on most public token offerings.
ICOs in iGaming
iGaming ICO activity has been concentrated in two patterns. The first is platform-token projects: an operator or platform vendor issues a token intended to serve as a discount or revenue-share mechanism for customers and affiliates. The second is casino-token projects: a project markets itself as a decentralised casino where the token represents an equity-like claim on house edge revenue.
Both patterns have produced a mix of legitimate projects and significant losses. Reputable B2B vendors and operators have generally avoided direct ICO fundraising in regulated markets and have pivoted to private token sales or equity-based capital raises.
Why ICOs matter in B2B
For B2B vendors, the legacy of ICO activity is two-fold. First, operators and platform companies need to manage exposure to historical ICO tokens that may still circulate against their products. Second, the secondary-market trading and AML history of ICO tokens makes them a higher-risk category for screening at deposit. Operators that accept tokens tied to past ICOs apply enhanced source-of-funds checks and may restrict deposit limits per customer.
The category is less active today than in the 2017 to 2018 window, but it remains a reference point for B2B due-diligence reviews of any token-funded project.
Frequently asked questions about What Is an ICO (Initial Coin Offering)?
It depends on jurisdiction and structure. Most public ICOs are now treated as securities offerings in the US and the EU, requiring registration or prospectus disclosure. Private token sales to accredited investors are typically easier to structure compliantly.
No. An STO (Security Token Offering) is explicitly structured as a securities issuance with regulatory registration. An IDO (Initial DEX Offering) is a token launch directly on a decentralised exchange. ICOs sit between the two and have largely been displaced by these newer formats.
A small number of mid-tier crypto-native casinos and platform projects have used ICOs. None of the major listed operators have used the format. Most current crypto-native operators are equity-funded or use private token sales.
Enhanced due diligence on token provenance, sanctions-screening on wallets linked to the offering, and source-of-funds documentation for any deposit linked to historical ICO holdings. Chainalysis and Elliptic tooling is the industry baseline.