The Changing ICO Demographic: Asset-backed Tokens On The Rise.
Upon entering the “Wild Wild West” of ICO a little over a year ago, whenever I mentioned the idea of creating a company backed by a hard asset, I was instantly hit by “how is this of a benefit to the BlockChain” or “you’re grabbing money!” or “this does not belong on the blockchain!”. Needless to say I was shunned by these early Crypto/BlockChain adopters and evangelists who believed that the only “real” token value was as a utility and the only proper use of the blockchain was as the foundation for a 4th Industrial Revolution.
The same was true at the beginning of the Internet. In the early days of the Internet and the World Wide Web, most of the infrastructure was owned and managed by governments, universities and large science projects. Their logic was to create an open free society where everyone could freely share information resulting in this great Utopian knowledge expansion! It will be open and free for everyone to contribute and we will change the world, becoming free of big business, mainstream advertising and marketing, and commercial interest. Any of this sound familiar? Admittedly and proudly, I was part of this way of thinking as an early adopter with one of the first 50 websites on the web.
Then one day, as a senior University student, I met a Real Estate broker who had a decidedly different point of view. We had a lengthy discussion about my views on the Internet and he offered me his opinion. “I’m a business man who has never heard of the Internet until now. Seeing that I do not share your views as they do not apply to me, I can foresee the massive benefit this new technology platform can potentially achieve for my industry.” Not being a part of the early movement and its utopian mentality, he didn’t much stock in my views of the perfect Internet. He joined the Internet Revolution at a later time when it was the “Wild Wild West” and was never exposed to nor shared my views. What he did have was an existing and profitable business, a vision and ability to spend $100K on a website and take a risk as one of the first batch of “companies” on the World Wide Web. Many more followed, taking more risks along the way, building more fortunes than ever before and changing the world as we know it today.
Just like with the Internet, that’s gone through 1.0, 2.0, 3.0, etc., there’s a rapidly changing trend happening within the crowdsale/ICO/token sale sector. The old school adopters who firmly believed that all tokens and offerings should be based on a “game-changing” software-based utopian utility platform creating borderless financial technologies and instruments are now bearing witness to more than 50% of those projects being in ruins or reported on as blatant money grabs. Its only funny money, right? Until you lose it. Slick websites, vaporware prototypes and teams that either have no proven track record or were often fake, promising great returns, but without an understandable or executable plan to monetization. Internet Deja Vu all over again, a la 2000 anyone? And just like in 2000, the industry is beginning to shift to real business, with real business plans, with real proven profitable business models backed by verifiable hard assets and being offered as Security Token Offerings (STO).
For the market to continue to mature into an alternative digital economic model for the future, this old school way of thinking “utility only” will need to evolve to be more accepting of asset-backed tokens and offerings. With regulations on the rise and token sales from 2017 literally in shambles, both existing and new investors entering the crypto space are becoming more risk averse, looking for more real businesses that can offer strong, realistic returns. With the regulations will come more compliance, offering security for large institutional investors and mainstream businesses to enter the blockchain/token/crypto sectors. And as history has proven time and time again, that’s where the real fun begins and a market is born.
IP.Gold is one such asset-backed token company. Taking an existing proven profitable business model developed and currently in operation by its founders, IP.Gold is expanding the digital assets it has to monetize, namely IP addresses, as well as the operations and scope of its IP Address Ecosystem, which monetizes the IP addresses, by offering an asset-backed token to contributors during its token sale that offers asset hold value creation, asset downside protection, and a 20% Quarterly Gross Revenue Share, and bonuses for early contributors.
More Asset Backed STO’s are coming, more and more every day. And with them, seasoned successful businesses, verifiable assets, major money, and market stability. What’s your opinion about asset-backed tokens and the future of the fintech and cryptocurrency markets?
By David Grieshaber
CIO — IP.Gold