Why are there no crowd-funding based altcoins created


#1

One of the things that gets me scratching my head is, there are no cryptos created that act as crowd-funding investment vehicles. Why are there so few cryptos being created that actually function on economic principles? For instance, creating a crypto that is “buy-in” based, where the currency is used to make real-world investments (buying toll roads, or building real-world businesses).

Yes, one could say we could run afoul of the SEC, where such coins are treated as shares of a corporation, but it would be the most valuable approach to crypto-currency in my opinion. Overstock’s CEO has similar ideas, but his application is more based on crypto-stock than actually direct investments related.

If you created a crypto that funds specific projects, where there is no ongoing mining involved, the increased number of coins is determined by the value of the next investment (at “x” market value). For instance, starting a $500,000 venture releases 100,000 coins at $5.00 valuations. The revenues from the investment result in the exchange value of the 100,000 coins rising to $10 each. The next project, valued at $1 million, would then require also 100,000 coins, which would be sold at the new market value of $10 each. The proceeds of the investments are paid in fiat or another crypto, such as BTC. Again, this acts like shares or stock in a corporation, but the number of shares are not limited and the mechanics of the transactions are not the same either.

It is just an idea. I have not thought it through fully.

Actually GH sort of did this the same way. We should take some of these successes and formulate something that is more broadly applicable. :smiley:


#2

I got about 2/3rds of the way through the body of your post and started thinking exactly this. I think the concept has some legs on it.


#3

Smart assets :wink:

Actually GH sort of did this the same way. We should take some of these successes and formulate something that is more broadly applicable.

Yes, we should


#4

@Allen1980s Hmm MasterTrader coin is doing crowdfunding and there is actually 20h left for the second crowdfunding… + they will ‘‘innovate’’ for the traders with the toshidesk.

http://forum.gethashing.com/t/mtr-mastertrader-coin/1629


#5

No, I mean a crypto currency that is crowd-funding. Not for itself, but to build other businesses, as per my example above.


#6

Ah ok, you think more far than I though when I reread a second time. :ok_hand:

I think it could be a great idea and it would be another way to get people into crypto : )


#7

This…
Technically from a tax perspective (in the USA) doing all the correct paperwork one could organize it as a massive exchange of personal property.

To do that, one would need all sorts of personal info most people in crypto would shy away from (Social security numbers, birthdays, addresses, etc for tax reporting).

The best way of trying to leverage that approach would be if something like a traditional brokerage firm (which already gathers that info by default) would create an investment vehicle leveraging the approach and make it so the average joe didn’t need to worry about the mechanics behind the curtain (aka the investor could care less about crypto-currency)


#8

Yes, this is true. However, in the U.S., classifying them as shares would mean a 100% write-off for those who lost most or all of their investment.


#9

Check out Positron Ann :smile:


#10

LFO will be on the scene very soon, and we hope to capture a % of that market, both online and offline, through our propriety system, backed by real world LFO traditions, and like you said, we also are working thru all the possibilities, and potentials, and roadblocks, so it may still be a while longer before we actually produce anything worthwhile