Is there an alternative for IEO?
It doesn’t matter if you work in the stock or crypto market, there are always two main questions:
— what if someone will deceive me?
— how much will I earn?
For a cryptoinvestor, due to the almost complete lack of regulation, the risks increase repeatedly. And here we are faced with a dilemma: on the first side, there is everyone’s easy access to financing/investment and high risks, on the other, legislative regulation with reduction of fraud risk.
If we return to our questions, then on one side there will be an ICO with its maximum risks and the same maximum expected return, and an IPO will be on the other with fewer risks and, as a result, the same minimized return.
Since cryptoprojects beat all the reasonable limits in the promises of profitability, the increase in project loyalty can be achieved only by reducing risks.
Projects which are conducting ICO make maximum efforts to convince potential investors in the reliability of investments, attracting reputable (or not) advisors, managing marketing budgets. And everyone understands that this practice leads to an even greater decrease in the efficiency of investments since a significant part of investor funds is spent on covering the expenses of the team on raising funds. And the more money is spent on marketing, the fewer resources remain on the project and on fulfilling its obligations to investors.
Projects wishing to realize the idea have practically no chance of attracting the attention of investors on the background of previously failed “scam” projects, for which there is only one indicator: the rate of return on investment in marketing (because no one is going to create/launch anything).
Cryptomarket has found a way to reduce risk — IEO, where the main adviser is the exchange, which guarantees the reliability of investments. But as far as this procedure has reduced the investor’s risks, it has so limited access to the market of a large number of projects (we are talking about conducting IEO only on large exchanges, since the small ones will not give the investor the required reliability and there will be no big difference from the classic ICO).
We believe that there is an alternative way that combines both risk reduction and free access to financing for many projects.
Decentralized Autonomous Initial Coin Offering (DA ICO) is the decentralized autonomous public placement of tokens.
I suggest considering this option of raising funds based on the WINBIX project.
DA ICO WINBIX is based on smart contracts that regulate all the aspects of project and investor relationships. The team has no tool to make changes to the stated conditions.
Here are the main characteristics of the PreDAICO smart contract:
— WBX tokens are allocated from the contract only in exchange for Ethereum,
— upon completion of PreDAICO, 10% of the tokens sold are allocated for the reward of Airdrop/Bounty participants
— untapped and unallocated tokens are destroyed
— the funds are not allocated to the project team
— the funds are managed by the Ethereum smart contract and allocated to the team in parts — 1 time in 30 days
— after 45 days, the investor has an unconditional and sole right to return the tokens to the project and receive his share of the balance in Ethereum
In our opinion, the use of DA ICO WINBIX smart contracts allows achieving two main goals:
— investor risks are reduced to the level of 2% — the size of the initial TAP, after which, if the team allows inappropriate spending, any investor could simply return WBX tokens to the PreDAICO smart contract to get his money,
— high motivation of the team to achieve a result at each stage of the allocation and expenditure of funds (please see paragraph above).
The code of our smart contracts is open, you can always check all the above on https://etherscan.io/
We believe that this way can become an alternative to IEO, making the relationship between the investor and the project more open, fair and transparent.
And in this case, we will be able to open access to the market for many projects without significant marketing budgets, but with the desire and ability to realize ideas, and the investor will receive the required protection from a scam, which is based not on expensive product packaging, but on Ethereum smart contract algorithms.
Alexey Generalov, co-founder & chief executive officer of WINBIX