How to Launch ICOs for Utility, Securities or Equity Tokens with Daonomic

ICOs made a huge splash in 2017, covering mainly networks/applications setup around so-called utility tokens. However other types of token are becoming more popular and aiming to bypass the utility token market cap, especially with more regulation coming to the space. These tokens are securities tokens and equity tokens. Securities and equity (stocks) tokens can be offered during the token sale and are referred to as a Securities Token Offering (STO) or an Equity Token Offering (ETO).

ICO/STO/ETO are set to become a fundamental part of the future as they offer startups an easier way to enter the global financial markets, as well as additional trust, flexibility, and liquidity to investors. Of course, the issuance of such tokens requires further development of technical infrastructure in order to comply with anticipated regulations. For example, the Delaware State Legislature recently passed Delaware State Senate, 149th General Assembly, Senate Bill №69: An act to Amend Title 8 of the Delaware Code Relating to the General Corporation Law, allowing tokenized equity.


Daonomic Features

The Daonomic platform consists of a novel, automated approach for creating tokens and launching token sales. Unlike many existing providers, Daonomic offers a self-service tokenization toolkit so anyone can create a token and start a token sale. A simple web interface provides easy navigation and offers standard pre-engineered models with automatically generated smart contracts. No coding, technical expertise, or experience with blockchain is required! Everything has been thoroughly tested on several token sales launched (or to be launched) with Daonomic.

INVESTOR WEBSITE AND DASHBOARD

We offer a personal investor account for token buyers. These are customizable investor accounts that can be integrated with any token sale website. This part of the project is open sourced (https://github.com/daonomic/daonomic-client) for anyone who would like to make their own custom version of the investor website.

ACCEPTING CRYPTO

Accept payments in various cryptocurrencies for token sales (including from exchanges). The platform itself doesn’t hold crypto coins received from token buyers. Instead, they go directly to the issuer’s wallet.

SMART CONTRACT GENERATOR

Self-serve solution to create new token sales with no programming required.

KYC FORMS AND A SERVER

Pass the data to the appropriate KYC provider or use our personal KYC server hosted on your side. API integration with providers to perform KYC/AML and a verification of accredited investor status.

BROKER DEALER SERVICES

Our registered broker dealer partner provides compliance supervision, oversight, subscription escrow, advertising approval for securities and equity token offerings.

REAL-TIME EMISSION

Buyers receive tokens immediately after the KYC and payment.

USD BASED PRICING

Token prices are shown in USD based on the current market rates of cryptocurrencies.

ALL TOKEN TYPES

Utility, Equity and Securities.


How to launch token sales with Daonomic

This short demo shows the full process: https://www.youtube.com/watch?v=nXhu-joeZEU

You can try ICO launcher on Ethereum Kovan network here: 
https://issuer-dev.daonomic.io

When you ready to launch your token on Ethereum Main network:
https://issuer.daonomic.io

Step 1. Design a token.

Step 2. Specify sale details.

Step 3. Set compliance and KYC parameters.

Step 4. Create email templates for registrations and password reset.

Step 5. Review and deploy automatically generated smart contracts to the Main Ethereum network or a testnet.

If you already have a ERC20/721 token you can add it to issuer dashboard as well. After adding existing tokens, you will get all the features of Daonomic, such as the ability to add token sale contracts and an investor web-site for each round of token sales. Also, you will get access to all features for searching payments and users, connecting KYC providers and more. All this can be done inside the issuer dashboard panel after registration on issuer.daonomic.io.

Step 1. Design a token.

In order to create a new token, the token issuer is required to fill in several sections.

Basic Token Data

This section is required to set up a standard ERC20 token on the Ethereum blockchain platform. It includes token and contract names, token decimals, and two attributes allowing more control over the token distribution and usage:

Pausable — Attribute allowing the issuer to control token transactions. E.g. The token issuer can ban all token transactions during the ICO/STO/ETO to prevent speculations.

Burnable — attribute allowing the issuer to destroy issued tokens.

Step 2. Specify sale details.

Every ICO/STO/ETO can be time-bound or eternal depending on the token issuer goals. There is functionality to indicate the starting and ending date of an ICO/STO/ETO. If the token issuer leaves these fields empty, the ICO/STO/ETO will be launched in eternal mode without any timeline.

The token issuer can specify a token sale cap if he wants to limit token supply. The sale cap can include bonus tokens, which are issued additionally to support a marketing campaign during the token sale. Again, if the token issuer leaves the field empty, the ICO/STO/ETO will have no sale cap. In this case, the token supply will be defined only by the demand from token buyers.

It is possible to set up a time-limited or bulk order bonus program using Time Bonus and Amount Bonus options. This allows a standard stepped ICO/STO/ETO design where in the early stages of an offering token buyers receive more tokens for the same token price. Applying the Amount Bonus feature can increase the average purchase amount, thus helping to reach the ICO/STO/ETO cap faster.

Step 3. Set compliance and KYC parameters.

The KYC procedure is required to verify the identity of token buyers either before or during the time that token issuers start selling tokens to them. It is particularly important if the token is going to represent a certain type of security, e.g. good or service, company share, etc.

Regulators like the SEC in the U.S., require that only certified investors can purchase securities. Therefore, in order to follow regulations and stay safe, token issuers must conduct KYC procedures.

A Token issuer is asked to provide a KYC Server URL where KYC data will be stored. Some of the KYC data can be classified by local regulators as personal, therefore token issuers should follow local guidance on personal data storage. The Daonomic platform will not store any personal data.

As soon as all the entries for Create Token forms are provided, the server asks to confirm with a transaction fee in order to create a token. The blockchain network takes the fee to keep the network running. The Daonomic platform does not take any additional commission for token creation.

After the token is created, the token issuer can see all the registered users with the status of their KYC check, and all token purchases. Later they can permit token purchases only for users having certain KYC status (e.g. whitelisted), which is especially critical for the security token sales in order not to break any local regulations.

Step 4. Create email templates for registrations and password reset.

This section helps to set up an ICO/STO/ETO mail server and manage the token sale process. It has basic fields regarding the ICO/STO/ETO mailbox as well as registration and password reset templates.

Step 5. Review and deploy.

As soon as all the entries are provided, the ICO/STO/ETO can be launched. After confirmation of the blockchain network transaction fee, the ICO/STO/ETO goes live.

After everything is deployed, Daonomic generates investor websites that can be integrated with the issuers’ sites, where investors submit their KYC and payment information to buy tokens after an admin approves their accounts.

Issuers use a generated admin dashboard to monitor purchases, manage token sales and approve investors.

This is a summary of basic functionality. More features are coming soon, especially for securities and equity token sales to help thousands of companies with their fundraising efforts.

As the market infrastructure matures, token sales will become the most preferred form of fundraising for startups, as it will offer great value to both investors and companies. Daonomic is happy to take an active part in this tokenization revolution by developing a better infrastructure.


Register and create your own crowdsale:
https://issuer.daonomic.io

Find out more about the Daonomic project on GitHub:
https://github.com/daonomic/