What’s indisputable is that coin offerings are quickly growing in popularity. Roughly 309 offerings have been held this year, raising $10.3 billion, according to the data provider TokenData, compared with 77 offerings that raised $1.2 billion during the period last year.
That is catching up to the amount of money raised by initial public offerings, where companies hire investment bankers to help sell shares to investors and trade on the public markets. I.P.O.s in the United States raised $15.6 billion in the first three months of this year, the biggest quarterly haul in three years, according to Renaissance Capital, which tracks I.P.O.s.
But many entrepreneurs say they believe that, at least for them, coin offerings make more sense as a way to raise money than the old ways of Wall Street and Silicon Valley.
The attraction for some companies is simple: It’s a potentially bigger version of a Kickstarter campaign, raising money from backers without giving up any voting control by selling stock. The tokens that investors receive differ from traditional company shares in that they offer no say in how the company is run, so buyers are betting that their value will rise as the digital currencies get used more.
And the process of selling a coin offering is relatively simple, where companies create their own cryptocurrency, write a document known as a white paper to describe the service that they’re building and hope enough people are interested in buying into the sale.
Still, other entrepreneurs saw something much more interesting in I.C.O.s.
For Ted Livingston, coin offerings were just what he had been looking for. His messaging service, Kik, has grown steadily over its nearly decade-old existence, but has no hope of displacing rivals like Facebook. And Mr. Livingston has no interest in trying to make money from selling advertising, as much of the social network industry does.
Trying to sell that to public investors seems fruitless. But a coin offering could allow Kik to create its own token and sell it to backers, who would find and create uses for it in the company’s own ecosystem.