ICOs are dead. Long live ICOs !

Capitalism has been at the root of major economic developments in the past decades. It is also responsible for the current decline of our civilisation sustainability. The high concentration of wealth is preventing us from being able to make changes. Wealth and governance are centralized more than ever and a very few people are determining our future, mainly based on their own interests.

Our society needs to create an innovative economic system to tackle the critical issues of our civilisation. We need crowdsourced investment tools to involve future users from the onset of innovation, on the funding and on the governance sides. We need to share with them the value created while promoting specific behaviors based on a sustainable strategy for the concerned community. Individual interests have to be set aside, and we need to put the priority on communities. We have only a few years to change our economic system orientation to avoid falling in the ditch.

From this perspective, blockchain has the potential to change the world. The main developments of our civilisation have been initiated by technological, industrial and cultural enhancements. Blockchain, tokens and ICOs are pioneering in the fact they could represent a technologic answer to the evils of our time. Blockchain support tokens, which involve users in projects funding and governance, as well as paying them out for the overall value created. ICOs represent the initial mechanism to start new projects in line with this.

But current ICO model have it all wrong. The financial world has contributed to corrupt the overall blockchain ecosystem with speculative behaviors. Projects are focused on raising as much funds as possible while speculating on their own token, instead of building value for their targeted communities. Potential users are afraid of tokens volatility and this is preventing them to fuel a real adoption for current decentralized applications.

Rules and regulation are having a hard time to provide a sustainable framework to make the situation better. Government and banking institutions doesn’t understand the inner promise of tokens. It now belongs to the ecosystem itself to bring self improvement plan to get back to the original motivation for the existence of blockchain and tokens.

Actually, some basic rules could help doing it better. We have to get back to the fundamentals of what we are looking for:

• For simplicity, we need a unique financial vehicle from the beginning to the end of projects. Token is the good tool for it. But this implies for it to represent a hybrid solution between a security and a utility vehicle.
• We need to create a framework to facilitate the emergence of projects consistent with the original motivation while playing with current traditional startup codes:

1. Several rounds of funding regarding the project maturity, the user adoption rate and the overall value created;
2. Barriers against speculation to focus on product development;
3. To consider users as key stakeholders, with equity rights;

All of this could be easily design. We only need a sophisticate framework, build by and for the blockchain ecosystem. This one could integrate the following points:

• A variable supply for tokens, to be determined all along the project development regarding the community growth. This would enable to dilute the weight of first investors while still generating value for the community.
• The possibility to freeze tokens obtained on each investment stage so as to avoid speculation while encouraging long term investors: tokens bought during a specific funding stage would be locked until the next one, or for a specific period regarding the project development plan. Investors would be allowed to release their tokens on the secondary market once it becomes sufficiently stable.
• Product usage would be encouraged through token usage with a well documented business model to create velocity and bring value within the network: tokens could be partly generated with user adoption, creating at the same time a secondary market to convert it and fuel product adoption.

We need to create peer-reviewed informatic libraries to implement different variations of this kind of features for projects to focus on use cases and product development. Smart contracts are still a very technical topic, and this complexity has to be hidden back a clear user interface for non-blockchain experts to launch token-based projects.

This is an open proposal to the overall blockchain ecosystem to create a dedicated consortium focus on the development of such a framework. We want to promote a new standard for Enhanced Token Offering.

In case of interest, contact me at blaise@nyctale.io or join us on Telegram https://t.me/joinchat/EQZGiRIOHJVj6xbXoXAuRg