An ICO (Initial Coin Offering) is considered a popular way for a startup company to garner funds and raise money for new cryptocurrency and blockchain projects. Early adopters and backers who participate in these ICOs may also gain a percentage of the company (or other bonuses), which incentivizes interest in the budding projects. ICOs are cropping up nearly every week.
ETHNews examines the two ICOs that have started this week.
BlockCDN is a blockchain enabled Content Distribution Network (CDN) that offers an online marketplace where bandwidth ‘ sharers’ crowdsource bandwidth for those who need it, at competitive rates. ‘ Sharers’ provide the hardware structure and the “demanders” use the network resources. As of November 28th, 2016, the firm is in talk with Youku, China’s leading online content provider, to test out BlockCDN’s service.
To date, BlockCDN has received over 9,700 ETH ($82k) in funding so far. The firm’s goal is to reach 400,000 ETH. If BlockCDN does not receive at least 150,000 ETH, all funds will be returned. However, investors do have the option of opting out at any time if the 400,000 ETH goal isn’t reached during the sale.
As an added incentive to early backers, BlockCDN is offering ICO participants 40% of BlockCDN’s transaction fees over the first three years. These dividends will be delivered to ICO participants’ wallets periodically through a smart contract. In order for the participants to receive this percentage, they must keep the tokens in the wallet they used during the ICO. If tokens are moved to a different wallet, they do not receive a percentage. This encourages participants to consider BlockCDN as a durable asset. Of the remaining 60% BlockCDN obtains during the ICO - 40% will be used to substitute the miners pay while BlockCDN builds their client base. 20% are reserved for bounties in the ICO crowdsale, and any unused bounty funds will go into the miners’ pay pool.
Start: December 5th, 2016
End: January 15th, 2017
Branche is an Ethereum-backed mobile app that allows users without access to formal financial institutions to cash checks and take out small loans at rates lower than the industry standard. They utilize an Ethereum smart contract to process Branche’s custom token as an authorized payment for these financial services. Branche hopes to reform the traditional business model of basic financial services by offering a simplified and streamlined system that will create business opportunities and promote cooperation within local communities.
Branche plans to avoid overspending issues created by uncapped ICOs by allowing ICO participants to contribute as much as they would like, but offer a refund system that’s proportional to the amount of Branche’s exceeded max goal. For example, the ICO cap is set at 250,000 ETH. Should the ICO rise to 500,000, participants will receive half of their contribution back.
Branche is also offering a token bonus reward for those who participate in their Branche Loyalty Tokens (BLT) system. Investors are given token bonuses based on the week they invest. As per the Branche site, the BLT bonus systems follows:
Week One: 15% bonus
Week Two: 10% bonus
Week Three: 5% bonus
Week Four: No bonus tokens
Start: December 5th, 2016
End: January 2nd, 2017
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