The Crowd is Always Right: ICOs, Regulation and Crypto Wallets in Your App
I’m taking a liking to Twitter surveys, and would like to highlight the past 3 that I recently conducted.
Following a cue from the first one that was prescient, I’m a believer in the wisdom of the crowd.
ICO or Token Sale?
In early 2017, some people started to dislike the term ICO. I’ll admit being torn between naming our conference ICO Summit or Token Summit (I had already privately registered the domain icosummit.com last year). Token Summit won, as it was the overarching theme. But the crowd was right that the term ICO had a lot of legs to it, and sure enough, we have seen the flurry of ICOs take off in the May/June timeframe.
*POLL* What do you think about the term ICO (Initial Cryptocurrency Offering) to depict the flurry of Token Sales Offerings. Is TSO better?
— William Mougayar (@wmougayar) April 19, 2017
Whither ICO Regulation?
To regulate or not regulate is not the question, but rather: to what degree, when, by whom, and for whom? In this survey, the time horizon is very important. The crowd doesn’t believe that regulation will come to ICOs within the next 90 days. This is a survey that is likely to be repeated.
Re: ICOs & Token Sales, Which of the following will likely happen in the next 90 days:
— William Mougayar (@wmougayar) June 24, 2017
Is That a Wallet in Your App?
Only a few decentralized apps have a built-in wallet that can hold your cryptocurrency tokens. Steemit is a well known example. If a token is part of your product or app, then the next logical functionality is to build a wallet to keep track of these tokens as you interact with the product or service. There is no doubt that more and more apps are going to include wallets inside of them.
One year from now, how many apps will you use that have a crypto wallet in them?
— William Mougayar (@wmougayar) July 5, 2017
While I can’t wait to see blockchain prediction markets like Gnosis and Augur take full shape at tackling the wisdom of the crowd on a larger scope, I think a few surveys can give a good picture.
In the first poll, Initial Token Offering makes more grammatical sense than Token Sales Offering therefore it is possible that survey participants factored that into their decision on which they like.
Possibly. it seems like water under the bridge for now though 🙂
It is interesting since “coin” has been largely replaced by “token” yet ICO is the term of choice.
It also does not cover the broader concept of selling tokens… What if we start seeing multi-phased token sales that can span months or years? “Initial” and “Coin” would not be inaccurate. The only word left here is “Offering” which is ok.
IPO is actually a more generic term. Public Offering could evolve to not only refer to securities and instead include pre-security funding. The word “Token” could be left out entirely since it is just an underlying mechanism which need not be surfaced in such terms.
But using IPO would unfortunately confuse people at this stage since it is so ingrained in buying shares of a company. So even if we start to think of having different types of IPO events, it might not help in the short term to use this acronym.
Most ICOs are actually Pre-Investment Support (PIS). At least according to the terms of the token sale. We all know that the motivation is to treat these tokens as speculative investment events that hinge on the tokens being listed on public exchanges. But if we go by the legal terms of the token sale events, these are not investments and they ARE donations to support the project with the hope that the tokens will have utility in the future in order to use the service. Most who purchase tokens don’t intend to use the tokens themselves so their will be a strong trend to sell them on the market. Imagine if the exchanges were not allowed to list these tokens. Decentralized exchanges, which are the future, would need to handle the post-ICO markets.
The crowdfunding space has gotten very murky. Everything from donations to good causes or kickstarter product ideas to buying shares in companies to buying network and app usage “credits”. Most terms used today are either too broad or too specific. More work is needed here. It helps to look at this broadly and with foresight.