The best year in the history of crypto has been 2017 and in that particular year, we saw the rise of Initial Coin Offerings(ICOs). Hundreds of new blockchains raised billions of dollars during 2017 but then suddenly bear market came which started the downfall of ICOs. ICOs are held today as well but there is no hype behind them these days.
Source
I think Binance was the first exchange that came with the concept of Initial Exchange Offerings(IEOs) where people pay for a coin in advance and then they receive coins in their wallets when that coin gets listed. IEOs are working pretty well for top exchanges as well as the coins.
However, a new method of raising funds has been introduced in crypto space just a few days ago and it is called DYCO which means Dynamic Coin Offering. In DYCO, investors can claim refunds if the project fails. This motivates the project team to work hard to achieve their milestones. However, the refunds won't be available immediately, the project owners are given enough time to prove that their product is going in the right direction.
A few days ago, Orion Protocol raised nearly $3.5 million in their DYCO which was conducted through Maker DAO. Orion Protocol, which is a DeFi liquidity aggregator has been built on top of Elrond blockchain. In the case of the Orion Protocol, investors will have to wait for a period of 9 months to claim buybacks. But if Orion Protocol delivers, they might not do it. Orion Protocol has already been done extremely well as it registered gains of more than 100% in a matter of a few days.
I think DYCO is here to stay for a long time until something better shows up. This gives the investors confidence to invest without worrying much as they are guaranteed refunds if the project fails. This also motivates the team to work hard on their project as they know that if they fail, they will have to return funds and I don't think they will ever want that.
Download Brave and start earning BAT.
We can also talk about the innovation of crypto coins and technology which has brought about revolutions in different sectors and at the same time has demonstrated significant changes in the financial model which opens up new investment opportunities for marginalized sectors. The supply of coins was the first to be sold in the market which has been very useful for the crypto coin sector in order to collect funds to help the neediest sectors from my point of view.
Agree with you :)
Interesting...do you know how they secure these funds? especially if they need them and use them to keep operating and trying to develop?
Posted Using LeoFinance
I am not really sure but I think a part of the capital raised is locked with a trusted 3rd party and some of it is used for development. The remaining funds are unlocked after the refund claim period.
In case of orion protocol, if investors want refunds, they will get 80% of the invested money.
I believe Vitalik Buterin has wrote about this concept a few years ago.
Has he? I wasn't aware.
This is an innovative way to raise the capital. I think more and more projects will raise funds through DYCO in near future.
This very interesting, in the personal I lost the wave of the icos, I hope to be able to win in this new tendency.
Good luck!
i feel really awesome while watching your post umair looks like you are fully into crypto world full of knowledge and experience. you have explained Icos before and now this new dyco cool. :)
That's not true. I have been in crypto for more than 4 years but my knowledge is no way near where it should have been.
Thanks for the kind words:)
Upvoted 👌 (Mana: 24/32)