Token Report: A Disney Blockchain & 29 ICOs This Week

We’re out late this week because one ICO on our list tripped a red flag at our email service provider (see footnote). As usual, we cover the news of the past week in crypto assets and offer a list of upcoming ICOs to watch, pulled from the Token Tracker, the world’s most comprehensive free ICO listing. Check out our new website for a demo of Token Clarity, which is entering private beta, soon. Forward this to your friends and tell them to sign up for the next Token Report.

Last week, Ethereum deployed the first stage of its Metropolis hard fork, the SEC figured out who’s going to chase down fraud and a Korean video game company bought a crypto exchange. This week, we’re watching two blockchain technology incubators (one tied to Dollar Shave Club, the other to Disney) and 29 more ICOs are coming out.

Last Week in Crypto Assets

  • The first stage of Ethereum’s hard fork Metropolis, Byzantium, was launched on the blockchain’s test net on Tuesday, and had completed a Zcash transaction on the same day.
  • The Gibraltar regulator issued a statement on initial coin offerings on Fridayannouncing that it would be introducing a new framework for projects built on distributed ledger technology starting in January 2018.
  • San Francisco’s Institutional Venture Partners (IVP) raised a 1.5 billion USD fund for cryptocurrency startups. IVP led a 100 million USD investment into Coinbase last month.
  • China bulls are predicting a swift end to the country’s ban on ICOs, citing the country’s Communist Party convention and investor support for NEO, which is kind of like China’s Ethereum — up 21% week-over-week on low volume.
  • Last week, a couple of websites belonging to CBS’ Showtime network contained scripts that covertly used visitors’ web browsers to mine Monero coins.
  • A report has South Korean gaming company Nexon acquiring Korbit, a Korean crypto exchange. Meanwhile, Donamu, the South Korean fintech that runs KakaoTalk’s mobile trading app, Kakao Stock, is partnering with Bittrex to open a cryptocurrency exchange called Upbit.

The Week Ahead in ICOs

Science (SCI)
Documentation
Open Date: October 2
Hard cap: 100M USD

Founded in 2011, LA-based Science is the incubator behind Dollar Shave Club, a subscription e-commerce company. Its ICO will fund a new incubator solely for blockchain tech entrepreneurs and startups launching ICOs. Science’s token holders will have access to the tokens created by the companies in Science’s portfolio.

Forget the disclaimer: Science outlines in its white paper a two-pronged return on investment: portfolio tokens will flow to SCI token holders in proportion to how much SCI they hold, and a SCI buyback funded with the proceeds of future equity sales. For that reason, they got a “high” rating on our regulatory risk measure. The developers acknowledge the coin is likely to be deemed a security.

Science calls itself the world’s first tokenized blockchain incubator, but there are a number of similar accelerators including CofoundIt, Boost VC, Chicago’s Bitcoin Center, Coinsilium and Outlier Ventures, to name a few. This week, Disney’s Dragonchain (see below) is also launching a blockchain incubator with a native token.

Science’s token sale will begin Oct. 2 and run for one month. It has established a hard cap of 100M USD at the price of 1 USD per SCI coin.

Team

Science’s leadership team includes two former MySpace executives, Mike Jones and Tom Dare. Co-founder Peter Pham was VP of Photobucket before it was acquired by MySpace. Together, the team has a combined 14 years of experience in VC and business acceleration.

Dragonchain (DRGN)
Documentation
Open Date: October 2, 15:00 UTC
Hard cap: No cap

Originally developed inside Walt Disney Co. (NYSE: DIS) to integrate business applications onto blockchain systems, Dragonchain is a serverless blockchain platform for businesses. Uses include protecting business data and deploying operational smart contracts that can be shared and monetized, supporting multiple currencies. It aims to be interoperable with other blockchains. Dragonchain was released as open source software in October 2016, and Dragonchain’s ICO will fund the launch of a commercial blockchain architecture platform as well as an incubator.

Much like Science, Dragonchain’s incubator will provide a suite of services to blockchain startups from incubation to launch, including legal, technical, marketing and economic consulting. It currently has five projects under incubation, including a cannabis supply chain project, a tokenized art platform and an intellectual licensing firm.

Dragonchain touts its focus on data privacy and security for big businesses. It proposes five levels of consensus to provide trustworthiness to consumers of data. It also wants to be fast and easy for developers by allowing them to speedily deploy blockchain applications in existing smart contract language support such as Java, Python and Node.

Dragonchain’s ICO will begin on Oct. 2 and is scheduled to run until Nov. 2. Of the 433.5 million DRGNs available, 55 percent will be distributed to the public and 10 percent held each by the foundation and Dragonchain reserves. Five percent will go into the Dragon Fund incubator. Dragonchain states in its token sale summary that capping the supply of tokens with an uncapped contribution will decrease the expectation of profit due to market price being undetermined until the conclusion of the ICO.

Dragonchain reports its legal team has deemed DRGN to not be a security per the SEC. Having built a product already, and steering carefully clear of promising investor returns, Token Report rates their securities regulatory risk at “low.”

Team

CEO & founder Joe Roets has been on the c-level in the blockchain space for the past five years. He started in the industry as senior VP of engineering at Symbiont, which digitizes financial instruments onto the blockchain. He joined Disney in 2014 to be the senior software architect in the corporation’s blockchain efforts, where he developed the private blockchain platform that would eventually become Dragonchain.

Disclosure: Token Report interim CTO, Ted Leung, is a former Disney employee, where he led an engineering team.

Scam of the Week

Email scams have targeted multiple projects these past weeks, including AirToken (AIR) and Red Pulse (RPX). Speculation on crypto forums has the scams originating with a list of addresses hacked from Enigma (ENG).

ICOs Opening This Week

Our email service provider required us to remove a link to Uquidcoin before sending. No explanation was provided, except that the link had tripped an automated spam filter. We’re not aware of any allegations against the project other than this post on Reddit regarding a recent service outage.

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Token Report is an independent financial information service founded by Galen Moore and Peter Vessenes. Galen is a financial journalist with a background in startups, venture capital and launching news sites. Peter is a co-founder of the Bitcoin Foundation, and launched the first VC-backed Bitcoin company in 2011. He is managing director at New Alchemy, a boutique consulting and investment group based in Seattle, Wash., that is making a pre-seed investment in Token Report.​

Nothing contained in Token Report materials or posted at tokenreport.com constitutes an offer or a solicitation of an offer to buy or sell a security, financial instrument, or other category of asset, or investment advice or recommendation of a security, financial instrument or other category of asset. Tokens involve risk and are not suitable assets for everyone. Token Report believes its information was obtained from reliable sources but does not guarantee its accuracy or completeness and accepts no liability for losses arising from the publishing of this information. The information provided by Token Report is not a substitute for financial, legal and other professional advice. Each individual should always consult his or her own financial, legal or other professional advisors and discuss the facts and circumstances that apply to the individual.

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