Sep 102017
 

Promote Your ICO

This is a guide on how to promote ICOs for creators. ICOs are all the rage at the moment, and there are many promising projects out there. However, good ICO projects tend to get drowned out in a lot of noise, which makes it hard for the crypto investors to take a serious look at your project. To promote your ICO to the crypto investor community, you will need to stand out from the crowd and do things differently. This guide will help you to learn how to promote your ICO and run a successful ICO campaign. The information comes from observing several scores of ICOs go through the process. We then distilled down the components of a successful raise versus an unsuccessful one, and figured out the key components of what makes an ICO successful. Here are the tips to help market your ICO to crypto investors.

Tip-1: Have a genuinely good value proposition for investors

This seems like a no-brainer, but you’ll be surprised by how many ICO teams don’t think about what’s in it for the investors. Remember, like any investing, the people are putting money into your idea and they may lose it all. The crypto investors know this all too well. However, as the creator of the ICO, it is your duty and responsibility to minimize the chances of failure, and provide investors a way to increase their chances of success. In case the product is successful, then the investors who put money into the ICO should be rewarded.

Don’t create unnecessarily large incentives for the team and advisers. You should aim to give away more than 50% and usually up to 80% of your tokens to the ICO investors because they are taking a huge risk. If you have inflation, make sure it makes sense and is used sensibly to improve chances of a successful product.

Make sure that if the protocol is successful, then the value flows to the ICO investors, i.e. they share in the project success.

Tip-2: Fill in the essentials: Whitepaper, Roadmap, and Team

Don’t skimp on this aspect. Think of what a venture capitalist would look at – team, vision, future of the industry and market dynamics, team dynamics, etc. These are all the elements that crypto investors look for as well. Therefore before you promote your ICO, you should get the basics right. Make sure your whitepaper is thorough. Whitepapers are not marketing documents. You need to provide all the technical details of the project in this document.

There needs to be a clear roadmap on where you see the product and protocol and how it evolves over time. This needs to be commensurate with your ask from investors, i.e. how much you’re looking to raise in the ICO. Make sure these are congruent and not ridiculous money grabs.

Finally, make sure the team is solid and that you have at least one serious blockchain developer. You also need members of your team to be proficient in your market/industry with experience. Highlight these experiences. Have a bio for each member of the team and what they bring to the table.

Tip-3: Use Bounties to Reach the Community

Now let’s get into the strategic aspects of how to promote ICOs. You will need to reach the community, and one proven way is via bounties. This almost always happens on Bitcointalk forum’s bounty section. It is usually better to hire a bounty manager and pay him a decent amount to manage and run the bounty on your behalf.

Also, you need to structure the bounty correctly. You should allocate a minimum of 2% for all the bounties. The most returns are obtained for Bitcointalk signature campaigns and articles/blog campaigns. After that come the social media campaigns like Twitter and Facebook. Pay more attention to Twitter than Facebook because that’s where the community really engages. Finally, have decent bounties for translations and community engagement in those threads. You can also use the Viral Exchange for running your ICO bounties.

Tip-4: Advertise on Authoritative Sources

Advertising is another way to reach the community. There are several ad networks you can use. CoinURL is perhaps the oldest ad network in the crypto space. There’s also BitMedia and CoinTraffic that are coming up now. CoinTraffic has pop-under ads on some of the most prominent sites like Coinmarketcap.

Tip-5: Engage with the Community

There’s no substitute for engaging with the community. Your best bet to promote your ICO to the crypto community is via Slack, Reddit, and Twitter. Focus on these three and other platforms like Facebook can take a back seat. You should reply to community questions and concerns promptly. Hire a crypto social media manager if you need to. If you do this, make sure the person is well versed in the crypto space. This is essential, as regular social media folks don’t tend to understand just how unique crypto communities are.

Photo Credit: mkfeeney

Jun 042017
 

Bancor Token Exchange

This is part-2 of our series exploring the new Bancor protocol. You can find part-1 here, where we discussed how the Bancor protocol allows for the proliferation of user-generated tokens while providing the tokens liquidity at the same time through a decentralized exchange on Ethereum via the use of smart contracts (so no counterparty risk like in an exchange).

Here, we discuss how the Bancor protocol can be used for the decentralized token exchange economy not just for newer community-type tokens, but for well-established crypto-tokens on Ethereum as well. We’ll also talk about how this ties into the token asset management space that other projects like Melon and working on.

First, let’s talk about creating a decentralized exchange via the Bancor Protocol.

Decentralized Exchange via Profit Arbitrage

There have been several attempts at creating decentralized exchanges. Many of them rely on external gateways that transfer the assets on the blockchain into ‘real world’ currencies. However, these still have a counterparty risk involved. These include examples like Waves or Bitshares that have a “DEX” (Decentralized Exchange) built into their products, but with the use of external gateways.

However, what Bancor is building is something different. It has the elements of price discovery outside of the decentralized exchange, which then drive the price discovery on the blockchain. The actual exchange mechanism itself is completely decentralized, and doesn’t rely on any external third-party ‘guaranteeing’ assets on the blockchain to be a certain value.

The way this works is through simple price arbitrage. There’s a smart contract that triggers the exchange of one crypto-asset into another. If the relative prices go out of whack by a lot, then arbitrageurs enter the market, and buy the relatively undervalued asset while selling the relatively overvalued asset, while offsetting their positions with the external exchange. This is the key to how the Bancor protocol enables decentralized asset exchange. The smart contract itself has no concept of a price. Instead, the assumption is that the price is determined not by price feeds but by arbitrageurs who have an economic incentive to get the prices in balance, otherwise they can make a riskless profit.

In terms of the actual implementation, like with Token Issuance, there is a certain amount of crypto-assets in reserve. However, these are full reserve as opposed to fractional reserve, and there are two crypto-assets instead of one. Now you’ve created a trading pair. No need of any external exchange.

I believe another important characteristic of the Bancor Protocol is that it enables the creation of new asset pairs that is market determined as opposed to exchange determined. Today, say if you want to use Augur as your base trading pair, you’ll be hard pressed to find an exchange offering you Augur trading pairs. However, with Bancor, you can easily create one by keeping Augur and another crypto-asset fully backed in the smart contract. This way you’ve created an Augur trading pair.

Asset Management and Crypto-ETFs

Another less appreciated aspect of the Bancor protocol is that it enables the creation of crypto-ETF like assets, without any centralized trust component, i.e. only via smart contracts. This will become increasingly important as crypto-assets become a genuine asset class on to themselves. The way Bancor envisions ETFs is the creation of multiple reserve assets in the smart contract, with a 100% backing instead of fractional reserve.

These smart tokens will become an essential part of the portfolio from an investment point of view. Already, companies like Iconomi are working on creating crypto-index funds. However, the ICNX that is created by Iconomi is completely centralized. With the Bancor protocol you can do the same (although for now only with Ethereum-based tokens) in a decentralized manner and just hold units of account in the smart contract that contains the tokens in reserve.

I predict that ‘theme-based’ investing in crypto will become common too. For example, think prediction markets will be the next big thing? There will be a crypto-ETF with Augur’s REP and Gnosis’ GNO tokens. As the scope of projects keeps expanding, this will become more important for investors that don’t want to take chances on individual companies but instead on the market potential.

Photo Credit: normanack

Jun 012017
 

Bancor Protocol

Bancor is building a really interesting economic framework that would make it easier to obtain price discovery for thinly-traded tokens. The goal of the Bancor Protocol is to allow for the creation of whole new types of token economies that may never otherwise have a price, because exchanges aren’t interested in adding thinly traded tokens. With the implementation of the Bancor Protocol, tokens can already have a source of price discovery and liquidity without there being any need to add them on external exchanges.

Economics of Token Issuance

At the heart of the Bancor Protocol lies a smart contract that is able to exchange specific crypto-tokens (called ‘Smart Tokens’ in the whitepaper) for an underlying asset. An important point to remember is that the underlying isn’t tied one-to-one to the Smart Token. Instead, only a certain reserve ratio is in place.

If there is a token issuance that uses the Bancor protocol, the following are the key parameters –

  • Money in Reserve – this is ETH or an ERC20 token in reserve with the smart contract. It can also be a combination of one, two, or many of these tokens.
  • Reserve Ratio – this is the ratio of reserves (in the form above) held in the smart contract. For example, if a Smart Token has a supply of 100, with a total of 100 ETH priced in, and an ETH reserve ratio of 25%, it means 25 ETH will initially sit in the smart contract.
  • Smart Token Supply – this is the total supply of the smart tokens being issued. In the example above, since we issued 100 Smart Tokens, that’s the total token supply.
  • Theoretical Total Reserve – this is the theoretical limit of ETH or another ERC20 token backing the Smart Token Supply. Note that this is simply given as the actual Money in Reserve divided by the Reserve Ratio. In our example, 25 ETH is the money in reserve, and the Reserve Ratio is 25%, so the Theoretical Total Reserve is 25/0.25 = 100 ETH.

It is important to note that the Theoretical Total Reserve described above is not the amount sitting in the smart contract. The smart contract only has this amount multiplied by the Reserve Ratio. The idea is that of a fractional reserve – in efficient markets, the reserve would never go dry because the price adjusts depending on the interaction with the smart contract (we’ll discuss price discovery and price movement mechanisms below).

If the Reserve Ratio is 100%, then the token and underlying would move together, i.e. if you issue 100 tokens backed by 100 ETH in the smart contract that can be withdrawn at any point of time, then the downside is limited to 1 token per ETH. However, things start to get interesting when the Reserve Ratio is less than 1.

Pricing and Economics Between Reserve Tokens and Smart Tokens

Before we discuss pricing-specific details, let’s outline why you would like to have a Reserve Ratio of less than one in the first place. Say there’s a token sale that raised 1000 ETH. The team can announce that 25% of this will be held in reserve, and the rest 75% will be used for their operating and capital expenses. This causes the price of the Smart Token to instantly float against ETH. Say 10,000 Smart Tokens were issued, which would mean a price of 0.1 ETH. Now due to there being a reserve, although the initial price is 10 Smart Tokens per Ether, the actual price can float even without it being added to external exchanges like Poloniex or Bittrex or even decentralized exchanges like EthDelta or Waves/Bitshares DEX.

So how does it work? Simply put, each time you buy the Smart Token by paying ETH into the smart contract, the price increases. Each time you sell the Smart Token and take ETH out of the smart contract, the price decreases. The magnitude of the increase or decrease is independent of whether you do one transaction or break it up into multiple transactions. This way, if there’s demand for the Smart Token, you can simply get it by exchange ETH from the smart contract. The price the smart contract quotes you is a cumulative value calculated based on all the previous buys and sells in the past.

Things get more interesting when external exchanges also list the Smart Token. Now there is a clear arbitrage opportunity between the floating exchange rate quoted by the smart contract and the exchange rate on exchanges. People can buy the Smart Tokens from two sources, and in efficient markets, the prices would come to parity. If not, someone can exploit the arbitrage opportunity and make a profit.

Bancor has some really interesting economics and game theory behind it. We look forward to the product being released and see how it affects the token issuance market.

Photo Credit: Flickr

Apr 192017
 

TaaS Crypto Research

TaaS (Token-as-a-Service)is a new crypto-asset (crypto-token on Ethereum), which is a closed-end fund for the cryptocurrency industry broadly. This means there is a fund management team that invests in promising new crypto-assets, crypto-tokens, meta-tokens, app-coins, or protocol tokens (whatever you want to call them), and shares the profits with its token-holders. TaaS will invest in existing crypto-assets and also in new ICOs (Initial Coin Offerings). In fact, TaaS itself is currently undergoing its ICO to fund the initial capital.

TaaS of course is not the first project looking to invest into the emerging market of ICOs and crypto-assets. Many different projects are trying to do the same, from ICONOMI (which was an ICO like TaaS and raised over $10 million) to Blockchain Capital.

However, they all differ in their approach – either the fund structure, or the types of investments. For instance, ICONOMI does a buy-back to return money to shareholders and there is no fee structure disclosed, which means investors don’t know how much they’ll lose out on operating expenses of the fund. Blockchain Capital is a tradeable and investable token, but its investments are more venture capital based rather than crypto-asset based.

With these in mind, let’s look at where TaaS fits into the picture.

Existing Financial Industry Structure

If you look at the largest investment banks in the world today, like say Goldman Sachs, you’ll see they have a very active research division. If you look at the largest hedge-funds today, they have their internal research division that forms buy-side research at these firms. These sell-side and buy-side research is an integral and important part of the financial industry.

The ICO and crypto-asset industry is very nascent indeed. Bitcoin, the grandfather of all cryptos, isn’t even a decade old. However, the market is adding billions of dollars worth of capitalization in months. Today, the market stands at around $25 billion, with the dominance of Bitcoin on the wane (relative to the total market size). Research in this area is just getting started.

The problem with many of the funds in the industry is that they are flying blind. They do not have a solid analytical and data foundation on which to build the investment thesis. Without this foundation, unfortunately, investments look like speculation. Instead of targeted investing, funds are involved in spray-and-pray strategies that doesn’t help the ecosystem grow.

The Investment Decision Making Process

It goes without saying that crypto is a fairly recent and unique asset class, which means the strategies that work for equity investors will not work carbon-copy with crypto-assets. However, we can take lessons from the existing financial industry.

The minimum level of due-diligence that any fund manager in the crypto space needs to take is to read the whitepaper, understand the product, understand the team behind the project, and look at the token structure, i.e. what is the use of this token. This first step itself is a big deal of research for most investors.

However, one cannot stop there. There are many other research questions to answer. What’s the potential market size? What are the valuation assumptions? What are some past deals with similar ideas? What kinds of ratios are existing tokens in this industry selling for? What’s the crypto-market capitalization for this and related ideas? What are the risks being faced by the industry?

To answer the above questions, one needs data and human judgement. However, getting the data is the first step. Today, there are very few avenues for investors to get this data about the market they are investing in.

How TaaS is Different

Enter TaaS. Instead of being just another fund management platform, TaaS is building the ecosystem from ground up. Instead of first doing the picking of ICOs/crypto-assets, TaaS is asking the meta question – what kinds of questions do I need to answer to make a good investment decision? To this end, TaaS is building a crypto data and research platform, aka the Bloomberg of crypto, in the form of Kepler. I predict this will usher in an era of new products in the crypto-research space, which is at a cross-roads now and very much needs these products.

Kepler can be subscribed to by outside fund managers as well. In the absence of such a product in the marketplace, the TaaS team is building one for the industry – an ambitious step but a step in the right direction nonetheless. After all, investments and research should always go hand in hand.

The TaaS ICO is ongoing now. Check out the site and other details at http://taas.fund/

Bitcointalk forum profile.

Photo Credit: Leo Hidalgo

Apr 012017
 

Lunyr Decentralized Knowledgebase

Lunyr is a new crypto-economic asset built on Ethereum, aimed to get the economic incentives right for distributed online knowledge sharing. Lunyr has built a clever set of incentive schemes that could potentially help it provide much higher quality information than other similar sites, including the likes of Wikipedia.

Today, Wikipedia represents one of the best known successes of large-scale knowledge sharing collaborative networks. In fact, it has been such a massive success that it killed the 244 year old Britannica Encyclopedia because the traditional model just couldn’t keep up with the frequency of updates and the addition of new information by Wikipedia. Run in a completely voluntary fashion, Wikipedia highlights that it is possible to create collaborative knowledge networks in today’s interconnected worlds.

Scratch a bit deeper though, and you’ll see a host of problems with the Wikipedia model, from errors to outright hoaxes. A large part of the reason for this is that neither the contributors nor the editors who later check the articles have any financial incentive. Economics, after all, trumps many other human systems of collaboration. As Adam Smith said,

It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest. ~ Adam Smith

Lunyr aims to create a better knowledgebase using people’s regard to their own interest.

Beyond Wikipedia

Lunyr aims to create a new kind of collaborative knowledge system, but this time around, they want to do it based on providing economic incentives that may remove the issues plaguing the Wikipedia model. Another benefit of the Lunyr system is that it is not limited to just the creation of written content.

The vision is to be able to expand the system to much beyond that. With the advent of technologies from Artificial Intelligence (AI) to Virtual Reality (VR), Lunyr aims to create powerful APIs that plug into all these systems that require information and knowledge.

This is a powerful feature, since it is likely that in the future, machines (machine learning/artificial intelligence) will be the primary customers of information and knowledge, rather than humans. Data, after all, is overtaking the written word already. It is only a matter of time before machine intelligence consumes more content than us sapiens. How then will they consume this information? They will also need to ensure the information is accurate, and that not anyone can change the ‘facts’ via which the algorithms operate. Lunyr provides a possible solution to that problem because there is economic incentive system built into the system to prevent such abuses.

Lunyr works by creating a completely decentralized knowledge sharing database. Contributors can create new articles, and get paid for their efforts. Editors can edit, make changes, and accept/reject articles and get paid for their efforts. There is also a dispute-resolution system, which is needed in decentralized networks because not everyone may agree with a certain point. The monetary value of the network is through advertising. There are less chances of corruption in a decentralized decision-making process like Lunyr than with a centralized model like Wikipedia through advertising.

The below is the timeline for the launch of Lunyr. Note that the Lunyr ICO is currently ongoing, and you can get 44 LUN per ETH right now. The project has already raised over $300,000 in the ICO. Note that since there is no bonus for early participation, it is expected that the Lunyr ICO will continue to see traction until its end, and likely attract a large portion of the funds towards the end of the ICO rather than the beginning.

Lunyr Timeline

Check out the project here.

ETH Address: 0xC059456BB0E2e9A2ACD5a4c8384b29a89E1a3642

Mar 112017
 

TaaS Fund Management
TaaS (Token As A Service) is a new crypto project that is filling the increasing demand for crypto fund management. There is a lot of investor appetite for easy access to crypto as an asset class. We are seeing this niche get crowded of late – ICONOMI, Melonport, etc. are all involved, in some way, to help investors gain exposure to the new crypto asset class, and satisfy their demand. TaaS is a promising new project that is aimed to allow investors to reap the gains from good cryptocurrency investments. TaaS is separating itself from the rest of the crowd in many different ways that we’ll discuss below. Also, the TaaS ICO will start soon, so keep an eye out.

TaaS ICO and Structure

TaaS will sell a maximum of 101 million TaaS tokens in its ICO (Initial Coin Offering) that will go on for a month. No additional TaaS tokens will ever be created in the future. Also, the token sale structure is set up in a way that the tokens have a fixed price (of $1) and any tokens not sold in the ICO will be burned. The ICO will start on March 27th 2017.

Interestingly, the team has refused to hold on to any TaaS tokens in the future, i.e. all the TaaS tokens that will ever be created will be sold to the general public. This is different from many other projects that usually hold on to a certain percentage of tokens sold in the ICO, so they can ride the price up if it pops after the ICO.

There are bonuses for the ICO, but the bonuses are not based on duration as many other ICOs do. Instead, the bonuses are based on how much has been raised already till that point. The following is the bonus structure.

TaaS ICO Bonus

How Does TaaS Work?

The details of how TaaS works is outlined in its official whitepaper. TaaS is an Ethereum-based token which is structured as a closed-end fund. A closed-end fund pools investments from investors, invests the funds in the market, and distributes the returns back to the original investors. In the case of TaaS, 50% of all the returns earned on the invested money is sent back to the original investors. 25% is invested back into the fund, thus raising its AUM (assets under management) and thus the NAV (net asset value) of the closed-end fund. The remaining 25% is distributed between operational expenses (15%) and a reserve fund (10%). The reserve fund is used to handle investor fund outflows during the life-cycle of the fund (remember it’s a closed-end fund).

Therefore investors in TaaS have two distinct sources of return –

  • Earnings distributed via earnings, to the tune of 50%.
  • Increase in NAV of the fund, which means each TaaS token represents a higher amount of money in the ‘pot’.

Of course, there are the usual elements of earnings growth and speculation that will also drive the market price of the TaaS token.

Fund Transparency

TaaS is handling the problem of transparency in two distinct ways –

  • For the payouts themselves, the team is building a smart-contract platform that will ensure fair payments to all investors, with a minimum of 50% of profits sent to the investors.
  • For the transparency of the fund and its holdings, the team is building a Cryptographic Audit (CA) technology. This technology will allow the investors in the fund to monitor and track the history of the closed-end fund and what types of cryptocurrencies (blockchain assets) the fund bought and sold over a period of time.

The transparency at the fund level is unprecedented in the world of closed-end funds, whether they invest in regular markets or blockchain assets/cryptocurrencies. The team wants to make this one of the distinguishing features from some of the other projects involved in crypto fund management.

How TaaS is Different

In addition to building a closed-end fund, the TaaS team is building a complete portfolio management tool that also combines an analytics platform. This is called Kepler. This is already in private beta and the current timeline for Kepler’s launch is end of 2017.

TaaS has some similarities to the ICONOMI.PERFORMANCE fund, in that it is run at management’s discretion (the management team makes the decision on what crypto-assets and ICOs to invest in). However, in the ICONOMI.PERFORMANCE fund, different investors buy ICP tokens (i.e. investors that want hedge-fund like exposure to crypto) and different investors get the fees from that fund, i.e. ICN investors. However, in the case of TaaS, the fund is owned by the token holders, and 50% of the total profits are sent to these token holders. Management uses a part of the funds to manage operating expenses. The structure of a closed-end fund is therefore simpler. This is more appealing to ICO investors. Finally, ICONOMI doesn’t have any tools for transparency. The team announces new investments on a blog post. However, neither the ICN investors nor the ICP investors know the timing of trades, or can audit the trades. This is in contrast to TaaS which wants to make transparency a cornerstone of its fund offering.

Melonport is also in the same asset-management niche, which aims to build a fully decentralized fund management platform with the help of Polkadot. However, the focus of Melonport is more towards providing the tools of fund management to any crypto hedge fund manager. Melonport doesn’t itself do any crypto investing on behalf of investors. On the other hand, TaaS has an actual management team in place that will do the research and analysis necessary to make intelligent investments.

The ICO starts soon. Check out the site and other details at http://taas.fund/

Bitcointalk forum profile.

Photo Credit: TaxCredits

Feb 272017
 

Edgeless Casino Ethereum
Edgeless is a blockchain-based casino built on Ethereum. It pitches itself to be a casino with 0% house edge, when games of skill are played with 100% accuracy. It makes money when players make mistakes, for instance, not everyone will play blackjack accurately all the time. Edgeless plans to launch with games of both skill (like blackjack) and luck (like roulette). It is using a scheme that uses 2 random numbers, with one of them being generated by the user himself, only after a number has been generated and committed by the house. This way, there is no way for the house to cheat. The smart contracts that power Edgeless are also open for everyone to evaluate.

Edgeless ICO

Edgeless is having its ICO, starting on 28th February 2017 at 3pm GMT. The ICO is structured with weekly bonuses, with an additional power hour bonus. Crypto-enthusiasts can participate in the ICO by sending their Ethereum from a wallet whose private keys they control (like MyEtherWallet). If you only have Bitcoin, you can buy Ethereum on exchanges like Coinbase or use ShapeShift.

The regular price at the ICO is 1 ETH = 1000 EDG (Edgeless tokens). However, investors who get in during the power hour (first hour of the ICO, which is 3pm to 4pm GMT) will get 1200 EDG for 1 ETH. Investors after the power hour but within the first week will get 1100 EDG for 1 ETH, and investors in the second week will get 1050 EDG for 1 ETH.

The Edgeless team released a big FAQ about the project, ICO, goals, team, etc. that investors should read before investing any money in the ICO.

Like some of the other ICOs, Edgeless is staying away from the US market. This is to ensure that the company doesn’t get in any trouble with the law and regulations, which are overly burdensome and onerous for businesses catering to Americans. In addition, American law doesn’t take well to gambling operations, even if Americans want those services. Therefore the ICO will have IP restrictions on who can participate, with Americans being excluded. It is a pity, because there are many Ethereum investors and enthusiasts in the US.

The Edgeless token is also a little different from the other recent ICOs in that there are no ‘dividends’. Instead, all token holders will enter a lottery-type system which collects 40% of all fees collected on the platform. The rest goes to the development team.

Other Ethereum ICOs

Edgeless plans to raise between 370,000 to 440,000 ETH, depending on the timing of money received during the ICO. At current prices of $14.7 per ETH, this translates to $5.44 million to $6.47 million. The company hopes that recent successful ICOs on Etherum have whetted investor appetite for bigger ones. Just in February 2017, Santiment raised its goal of 12,000 ETH in a matter of a few hours. Then, Dfinity raised around $3.9 million with a $1 million goal. Finally, Melon sold out its ICO of $2.9 million in under 10 minutes.

Edgeless hopes that investors will be willing to invest more money into its ICO, with the attraction of capturing a part of the gambling market. With an average expectation of $6 million, its ICO will be one of the largest ones in 2017 thus far, if it is successful. Investors can get more information about Edgeless ICO from the official crowdsale website. Check out the homepage here.

Disclaimer: US citizens are not legally allowed to participate in Edgeless Project crowdsale.

Photo Credit: World Poker Tour

Feb 192017
 

Melonport ICO Seed
The Melonport ICO (first round, seed) was completed in under 10 minutes, and the project raised 227,000 Ether, which is around $2.9 million. Melonport pitches itself as blockchain software for asset management. The ICO was finished way too early for many enthusiasts and therefore I believe the token wasn’t as widely distributed as it could have been.

In all, 500,000 Melon tokens were for sale to the public, out of the 750,000 created by the team for this round. The total supply of Melon tokens will not exceed 1,250,000 tokens, with the rest of the 500,000 tokens potentially being sold in a second round next year in 2018. The Melon ICO price was around 0.45 ETH.

The Melonport ICO was notable in the frenzy returning to the ICO markets, reminiscent of the First Blood and Singular DTV ICOs of 2016 that also got filled in record time of under 15 minutes for both the projects.

Another interesting aspect of the Melon ICO was that 56,750 ETH were sold via Bitcoin Suisse via their services which accepts not just ETH like the Melonport ICO smart contracts, but also currencies like BTC and even fiat currencies like CHF. In this way, Bitcoin Suisse was acting as an ‘investment bank’ for this ICO, reserving and guaranteeing a certain supply to be sold out to investors via their services. Terms between Melonport and Bitcoin Suisse haven’t been made public. Bitcoin Suisse was able to reserve 25% of all the Melon tokens sold to the public in the ICO, i.e. 125,000 Melon tokens were sold via Bitcoin Suisse for a total of 56,750 ETH. The price per Melon token was around 0.45 ETH (2.20 Melon per ETH). Bitcoin Suisse charged investors a fee of 1.25% and a flat fee of 100 CHF. Therefore it is likely that some of the big fish in the crypto markets had gone through Bitcoin Suisse instead of the little guys.

There has been no announcement from funds like ICONOMI or Coin Fund on whether they invested in the Melon ICO or not. In any case, as the ICO frenzy showed, it is a well followed and well watched project.

The Melon tokens are expected to start trading and become liquid in around 4 weeks. We anticipate a large increase in the trading price compared to the ICO price when it starts trading.

Photo Credit: harsha

Feb 142017
 

Dfinity Final Seed ICO Raise
Dfinity completed its seed ICO yesterday with a total amount raised at 3.9 million CHF. The project had a soft-cap for the ICO at 1 million CHF and an additional 24 hours from this time before close. This soft cap idea is a new one in crypto ICOs. At the end of the ICO, i.e. 24 hours after the soft cap was reached, the ICO closed with around 3.9 million CHF total raised. The soft cap of 1 million CHF was hit in only 75 minutes from the start of the Dfinity ICO.

An Interesting Way to ‘Cap’ the ICO

Dfinity tried an interesting way to cap the ICO. Instead of a hard cap, i.e. the ICO closes the moment the Ethereum contract receives the maximum amount of money defined in the contract, Dfinity opted for a ‘soft cap’. The soft cap was implemented as follows – the ICO closes 24 hours after the soft cap is reached. This has an advantage that investors don’t need to wake up at ungodly hours to meet a 15 minute ICO window, which happened with some hot tokens last year like the FirstBlood token. Such ‘insta-sale ICOs’ are bad for the project as they tend to concentrate the tokens in the hands of a few whales instead of distributing them widely to the community.

Of course, the flip side of this is that investors don’t really know the price of the token they are getting until the end of the ICO, which makes return calculations hard. For example, if investors place a risk-adjusted value of $2 million in this round, there is no way to know whether to invest or not, because the ICO might raise more or less than that amount. With a 24 hour window, it was at least mitigated though.

Blockchain Nervous System

Dfinity has created some interesting ideas, most notably the Blockchain Nervous System. This allows the token holders to vote and change important economic parameters. It also is a back-stop against bad behavior, or bad bugs, like preventing potential The DAO type situations. If the majority decide, they can pretty much do anything, although proposals come at a cost. This has a very different dynamic to the ‘code is law’ principle followed by Bitcoin and Ethereum Classic. It is a softer version of that.

Although Dfinity claims not to compete with Ethereum, it offers a Turing complete language to write smart contracts and applications in. The technology developed with mutually benefit Ethereum and Dfinity, but there is also definitely a competitive element. Dfinity will provide value to the token holders by bringing in projects and apps being built on it, which would otherwise have been built on Ethereum, likely. Dfinity also believes that some of the technology being developed by the team will help Ethereum. Collaboration among crypto projects is always welcome as it moves the whole ecosystem forward.

Feb 142017
 

Santiment ICO
Santiment ICO presale (first round of the ICO) sold out within 2.5 hours, raising its target 12,000 Ethereum (ETH) during this time. The ICO presale had a lower limit of 4,000 ETH and an upper limit of 12,000 ETH. Unlike the recent Dfinity ICO seed round, the cap was a hard cap and therefore investors who weren’t able to get in during this time were out of luck. The presale ICO cap of 12,000 ETH, which was under $150,000 when the ICO closed, would be considered to be on the low side.

The contract, and its associated transactions can be viewed on the Ethereum blockchain.

About Santiment

The santiment project is a ‘crowd sentiment data platform for crypto and blockchain assets’. The value of the token comes from its use on the platform. The token is required to pay for services on the network, while contributors to the platform earn the token.

The project aims to help crypto traders improve with better data. For instance, users can play crypto games in simulated environments before putting real money on the line. In addition, the projects aims to develop better visualization tools than what exist today in the market. The platform’s data might also become useful for researchers looking into the crazy crypto markets.

The value proposition of Santiment depends highly on the community, and indirectly on the data produced by the users. The data generated by crypto markets may not be as easy to analyze as regular markets. However, crypto traders are an active bunch, and their ranks are growing. Santiment might tap into their natural tendencies to trade (or perhaps over-trade) and generate the data required.

Investors and Follow-up Rounds

Given the small maximum size, only a few investors were able to get the Santient tokens in the presale ICO. Notably, the ICONOMI.PERFORMANCE fund invested in Santiment. This would be ICONOMI’s third investment in the cryptocurrency space, after Golem and Byteball. This is an interesting move, because there was no prior indication to the market that ICONOMI might be interested in this ICO. That might be a deliberate move, given the small cap.

Some investors are looking forward. The project will use the funds raised today for its whitepaper and a minimum viable product (MVP). The creators estimate a time frame of 3 months for this.

Also, investors might like to know that this was just the presale to the main token crowdsale that will likely take place after the whitepaper and MVP are released. However, investors who were able to get in on the presale will get a 54% ‘bonus’ in terms of price.