CryptoBridge Funding Model : No ICO, No Premine. Fair & Distributed
While most other exchanges, DEX’s , cryptocurrency and blockchain focused companies took the opportunity to to capitalize on the current ICO frenzy,CryptoBridge took a different approach for funding.
The problem with making an extrinsic reward the only destination that matters is that some people will choose the quickest route there, even if it means taking the low road. Indeed, most of the scandals and misbehavior that have seemed endemic to modern life involve shortcuts.”
― Daniel H. Pink, Drive: The Surprising Truth About What Motivates Us
To develop a platform like the one described in Introducing CryptoBridge: A Decentralized Exchange Owned by BridgeCoin Holders , one requires funding to recruit a lot of skilled full time developers, cover marketing costs and to cover other expenses. To reach our funding goals, the team has used a rather unusual method of creating altcoin to fund the development of the CryptoBridge platform and BridgeCoin(BCO).
In this post we will provide insights into why we opted to go the route of avoiding an ICO and choosing not premining BCO by focusing on:
- Funding Model
- Regulation & Compliance
We decided to create and fairly launch BridgeCoin(BCO) to fund the development of CryptoBridge. The release of BridgeCoin(BCO) was done in July 2017 under the following conditions:
- No Premine
- No IPO/ICO
- Open Source
- Public Announcement
You can learn more about BridgeCoin(BCO) by going here for more details
As founders of CryptoBridge we choose to also mine BridgeCoin(BCO) with the public as we expect that the market value of BridgeCoin(BCO) will be sufficient to finance the development of the entire platform. This immediately aligns the success of CryptoBridge with the users of the DEX as we are incentivized to not only build a salable, secure and user friendly platform but to also see the price of BridgeCoin(BCO) appreciate and increase in value to drive development of the platform. In short, we like to deliver results before taking money off the table(ICO’s we see you).
BridgeCoin(BCO) also has the additional incentive that allows those that have mined or purchased BCO to stake their BCO to earn 50% of CryptoBridge trading the fees.(More details in future posts)
Another objective was to ensure that that BridgeCoin(BCO) would be freely distributed to a much larger number of users when compared to other means such as ICOs and to development a community around CryptoBridge . Choosing to publicly mine BCO to fund the development of CryptoBridge allowed both traders and miners of all sizes and economic backgrounds to accumulate BCO.
If you create a currency without mining, also known as pre-mining, and then sell this currency for fiat money or substitute (aka convertible virtual currency like Bitcoin), then you could be considered a MSB and subject to all of the rules and regulations that apply.
Regulation & Compliance
One of the most important objective of our approach when selecting our funding model was to ensure that we are in compliance with most if not all regulatory bodies. Even though we are a decentralized exchange we thought it would be prudent to get legal advise to ensure that CryptoBridge will stand the test of time not only technologically but also legally if required. The CryptoBridge team consulted with a legal firm to ensure that we would be in compliance regardless of jurisdiction.
Since the latest SEC publication it is certain that any token sale (ICO) that promises future returns can be considered illegal in the US. Though we are not from the US we would still like to stay legal under most jurisdictions and a public mineable cryptocurrency is exempt from such regulation.
The challenge faced by startups is that they need capital and the most efficient means of raising capital is to sell tokens. The question is how do you get tokens to sell if you cannot pre-allocate any currency to yourself. The other question is what constitutes legal computing or manufacturing effort as authorized by FinCEN as being legal use of convertible virtual currencies? from How to Launch a Crypto Currency Legally while Raising Funds by Daniel Larimer
You can get started today trading today by visiting CryptoBridge
- How to Launch a Crypto Currency Legally while Raising Funds
- SEC Exposes Two Initial Coin Offerings Purportedly Backed by Real Estate and Diamonds
- Investor Bulletin: Initial Coin Offerings