ICO market ‘very young’ so we are still the best place to raise cash, Nasdaq exec says

Nasdaq markets are still the best place for a company to raise money despite the rapid rise of the initial coin offering (ICO) in the cryptocurrency world, the vice chairman of the U.S. stock exchange.

"We are a regulated market, I think that's the difference between us and an ICO. And we'll see at some point those markets become regulated and that will change everything," Aust said.

"It's very young and early stage and Nasdaq has always been at the forefront of helping companies raise capital, whether it be in the Nasdaq private market or through the Nasdaq public markets. So we believe that we are the market for companies to raise capital."

An ICO is when a company issues a digital coin or token in exchange for a cryptocurrency in order to raise cash. The people who invest typically don't get an equity stake in the company, but can trade the coin on an exchange or use it to do something with the company.

It bears some similarities to initial public offerings (IPO), where an investors buys shares in a company. But with an IPO, a person often has a stake in the company. Because of this, some have seen ICOs as a potential threat to the IPO model. But they remain unregulated.

The ICO market is still tiny compared to the IPO market. Companies have raised around $3.2 billion so far this year from ICOs. In comparison, companies have raised $126.9 billion via IPOs up to the end of the third quarter.

Source: Bloomberg Pro Terminal

Trader Bozhidar Arabadzhiev

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