How I explained to my Mom that I’m launching an ICO
For people like me who are trying to conduct business in the tech world, it can be quite difficult to explain to individuals outside the field what exactly I do on a daily basis.
I developed my first website at eighteen years old (now I’m thirty), and at the time not even my teachers were really able to understand the utility of what I had achieved.
Over the years I became less concerned about what other people thought of or understood about my line of work.
At family gatherings when my grandparents, aunts and uncles would ask about my job, I could always resort to the standard reply: “I work with computers.” That was enough to satisfy their curiosity and earn myself a good pat on the back.
Today, however, we find ourselves in a truly meaningful historic time in which changes occur so rapidly and are so all-encompassing that they disorient people. In this sudden wave of innovation, even techies and digital experts find themselves unprepared at times.
So I’ve come up with an imaginary, but not entirely improbable, conversation with my mother, whose attention has turned to what, for the past few months, I have been working on night and day.
“So, what money-hemorrhaging startup are you working for now?” asks my mom.
“It’s not a startup this time, Mom. I’m about to launch an ICO.” I answer her.
“An ‘I see’ what?!”
“An ICO, Mom. An Initial Coin Offering.”
“Is that another way of saying you are doing something revolutionary that I will never understand?” she quips right back.
“No, Mom! Although it is actually the most revolutionary thing I’ve worked on up till now.” I affirm with a hint of pride in my voice and a sparkle in my eye.
“Okay then, try to explain it to me, as if you had to explain it to a child, or better yet, to your mother!” She smiles, pleased with her clever self-irony.
D: “I’ll try, but you stop me every time I say something you don’t understand.”
M: “Okay fine, go ahead!”
D: “As you know, CharityStars is an online auction platform that puts objects and experiences with celebrities up for auction, and that 80% of what we raise from the sale of these auctions is donated to support over 500 nonprofit associations around the world.”
M: “Of course I know CharityStars. One time I even asked you to make an offer for those Rolling Stones concert backstage tickets, remember?”
D: “Yes, I remember, Mom, but let me finish, please.”
M: “Oh, sorry. Go ahead.”
D: “With CharityStars we have decided to launch our own cryptocurrency on the market. A cryptocurrency is essentially a virtual coin, which therefore has no physical equivalent and is not tangible like a $50 bill, but it’s a digital product that can have an economic value and allow you to purchase goods and services with it.”
M: “Wait a minute, how can you issue ‘virtual money’? You aren’t a bank or financial institution…”
D: “I know, we’re not, but the issuing of a cryptocurrency is a free operation that anyone can do using a technology called blockchain. A blockchain is like a giant master ledger, where all monetary transactions regarding cryptocurrencies all over the world are tracked.”
M: “Oh, so there are already other existing cryptocurrencies?”
D: “Yes, exactly. There are quite a few, and the most famous ones are called Bitcoin and Ethereum, but I can’t go into this too much right now. I’ll tell you more about them another time.”
M: “Ok, ok, go ahead. I’m starting to get my head around it!”
D: “Thanks to the blockchain and smart contracts, we are able to program the issue of a token, a sort of virtual ingot. In other words, intangible, not physical. You can’t touch it, but you can purchase it and keep it in a virtual, or digital, wallet.”
M: “Okay, I get it. Go ahead.”
D: “The issuing of this virtual coin by CharityStars means the creation of a new form of payment for all the charity donations all over the world. Our dream is that all non-profits everywhere will be willing to receive donations in AidCoin (the name of our coin) and that people will prefer to purchase AidCoins to then donate them instead of using other old, not-so-transparent methods like solidarity texts, telethon, etc. Thanks to blockchain technology, it will indeed be possible to fully track the donation from the donor to the nonprofit, as well as track how the latter spent the funds.”
M: “But if the nonprofit has to purchase water and food, how can it spend your virtual coins?”
D: “Excellent question. Now you are really getting it. The last step is that we are making our payment system AidPay available (imagine it like a sort of Point of Sale ATM where you swipe your credit card) so that nonprofits can directly purchase products and services they need, paying in AidCoin or converting them in Fiat.”
M: “Fiat? What do Fiat 500 cars have to do with it?”
D: “No, Mom! In economic jargon Fiat money refers to standard paper bills — what you use every day to buy goods and services. The money you have in your wallet right now…”
M: “Call them dollars then, for heaven’s sake! You sure have a good time using all these techy terms with your Mom, huh?”
D: “C’mon, let me finish explaining, it’s an important concept. As I was saying, with this method every purchase will be tracked, and we will all finally know how the funds were invested. It’s a true revolution on a global scale. Imagine how many more people will feel motivated to donate!”
M: “Wow, that’s really a great idea. Good for you guys!”
D: “Thanks! As you may know, CharityStars is a for-profit company with a noble mission, but also one that has to keep its books and be sustainable. Otherwise the wheels wouldn’t keep turning and we wouldn’t be able to change the world.”
M: “What are you saying?”
D: “I mean that making an ICO is at the same time an opportunity to raise capital from external contributors (you can even be part of it) through crowdfunding — in other words without selling any shares — and a chance to convince people all over the world that your project is valid and that it deserves to be financed.”
M: “How do you raise this capital?”
D: “To anyone who wants to invest in our project, we will give one or more tokens (based on how much they invest), or virtual coins, called AidCoin. People will be able to purchase them with Ethereum (another virtual coin that in today’s market is valued at $440), and once they have received them they will be able to use them on the CharityStars platform or even to make donations to all nonprofit associations around the world in the future — which is what we are hoping will happen.”
M: “So are you telling me that you guys are going to sell a virtual coin in exchange for real money?”
D: “Exactly, even if you make it sound like we are selling Monopoly money in exchange for $500 bills! Yet, while the concept may seem similar to that, the pillars it is founded on are much more stable, and the technology supporting this product is incredible. CharityStars is a company that this year will reach 5 million euros in online sales, 80% of which will go to finance charity projects all over the world. The introduction of a virtual coin based on blockchain technology can bring an incredible revolution in the world of charity and clean up the sector and make it transparent.”
M: “Yes, I understand that now, and it’s certainly commendable. But how can you convince people to get involved in your project?”
D: “For months now we’ve been working hard on launching the ICO and for months I’ve been doing exactly what I just did with you. I tell anyone and everyone I meet the scope of our project and the dream we are trying to make a reality.”
M: “Is it working?”
D: “I would say yes, considering that in 3 days we have already received almost 7,000 ETH…”
M: “7,000 what?”
D: “ETH is the symbol for Ether mom, the virtual coin that I mentioned before. There is also another coin called OMG, but it doesn’t stand for the “Oh My God” you’re probably thinking. Maybe in the future we will all use OmiseGo, you never know!”
M: “Omise what? Ok…this is too much for the moment. And what is your symbol?”
D: “AID. Like humanitarian support, do you like it?”
M: “Yes, you convinced me, I’ll talk about it with your father. Just one thing: can we even use our Walmart fidelity card points to buy your coins?”