Despite the controversy swarming around them, initial coin offerings (ICOs) are here to stay. They offer an innovative way for new cryptocurrencies to obtain funding, and many ICOs have proven to be very successful. The problem is that many ICOs have nothing to show when they go to ask for people’s money and a small minority are outright scams.
The reason so many ICOs start out empty-handed is because they don’t have the capital to build the prototype product. Some, like the creators of Decred, develop their project out of their own pockets. Others approach the market with an idea and pray that investors will fund them, and the rest look for an ICO incubator to help them develop their initial product. One of these ICO incubators is part of Global Blockchain Technologies Corp. (TSXV:BLOC.V, OTC:BLKCF), which has used its expertise to help new ICOs get off the ground and succeed.
ICO incubators are becoming an important part of cryptocurrency
The main criticism of ICOs is that many projects are poorly thought out and likely to fail at best, or outright scams and Ponzi schemes at worst. The most high-profile example recently has been Prodeum. This was an ICO promising to put “fruit and vegetables on the blockchain,” and then promptly proceeded to disappear with investors funds, leaving behind nothing but the word “penis” on their official website.
It is also very difficult for many ICOs to achieve their funding goal. In 2017, Moguldum conducted an analysis of token sales and found that in September 2017, 66% of token sales had failed to achieve their funding goal.
Once a token sale fails it is difficult to try again, so all the work put into the project is usually wasted. This is where Global Blockchain and its ICO incubator come into play.
Bringing expertise to new ventures
Global Blockchain was one of the early investors in cryptocurrency and has been a longtime advocate of both cryptocurrency and the blockchain tech that powers it.
In October 2017, the company explained that it was creating an ICO incubator because it believed token sales were an important part of the cryptocurrency incubator and wanted to “vet the best concepts from a technical and business perspective” to see whether they offered something new.
In other words, Global Blockchain only wants to back projects that have a long-term future. This is important for investors because it means that any ICO backed by the company has the support of some of the most experienced people in the cryptocurrency business. It can likely be trusted to be legitimate.
In order to gain entry into the ICO incubator, a project needs to first approach Global Blockchain and request assistance. The company will then do its due diligence and decide whether the project is viable. If it is, then capital and expertise will be offered to help build their prototype and prepare for the ICO.
In exchange for this assistance, the new venture provides Global Blockchain with advance tokens and a stake in the venture. This then allows the company to benefit from the future success of the ICO and pass those gains onto their shareholders. In other words—everybody wins.
Global Blockchain’s ICO incubator is good news for the cryptocurrency world. It will help promising new projects make a strong start while also adding some kind of quality control and beginning to clear up the murky reputation of the ICO.
This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.
The Exodus of Chinese Miners Leads to New Electricity Tariffs in Russia
Many conditions make Russia ideal and attractive for mining cryptocurrencies. It is one of the countries with the highest electricity...
IRES’ Recommendations to Ensure the Economic Recovery of Morocco
In its latest strategic report, IRES believes it is important to rethink the future of Morocco's new trades, which have...
The Stock Market is a Price-Discounting Mechanism, Or Used to Be One
Dow Jones closed this week with a BEV of -0.93%. It hasn’t been this close to a new all-time high...
USDA Production Estimates Influences Oats and Corn Futures Prices
Corn and Oats closed with moderate losses last week on selling seen in response to the latest USDA production and...
Innovation in Healthcare Technology, Key to the Sustainability of the Healthcare System
Lluís Blanch identified two barriers to innovation in healthcare technology: the lack of interoperability of data and the lack of...
Biotech2 weeks ago
Canada’s Hidden Health Crisis: Is This Company the Only One Paying Attention?
Cannabis2 weeks ago
The First Bottles of Medical Cannabis Oil Delivered to Patients in Jujuy, Argentina
Cannabis1 week ago
Malta Might Soon Legalize Private Cannabis Consumption
Crypto2 weeks ago
Why NFTs Will Play a Central Role in the Film and TV Industry