Token Talk June 28, 2018: Ankr ICO and Choon ICO Reviews
Ankr ICO Review
Ankr are pushing a blockchain solution that is based around Proof of Useful Work, Trusted Hardware, and Plasma and side chains. What does all that mean, and why does it matter here? But first, their current stats: they’re in pre-sale, with the private sale completed. They’ve got a hard cap of $16 million, and their crowdsale is planned or the end of July. Now, on to those terms:
Proof of Useful Work - where currencies such as Bitcoin power the network by Proof of Work mining, this leads to massive inefficiencies as all players are simultaneously spending computing power (and therefore electricity as well) on cracking the same puzzles (hashing) whereas, under a Proof of Useful Work scheme, the miners are performing useful work in the form of cloud computing services as well as hashing whilst mining.
Trusted hardware - well, this term is one of the basic architecture choices they are committed to, and it revolves around an Intel architecture called SGX, or software guard extensions. These were introduced to chips from 2015. In very simple terms, it makes a little secure partitioned room to work with that even if everything else bombs and gets hacked, access isn’t granted. Mining will be via SGX CPUs and therefore it is planned to try and democratize mining to a far wider group and unused resources sitting around the world in SGX idle chips.
Plasma chains - Plasma is a protocol that seeks to allow one main branch to be the backbone of the network and then side chains or specialized nodes for differing operations or customers branch off. This would allow the growth and scaling of the network with possible large benefits (and of course it would bring new large problems like all new solutions can).
And they plan to release a prototype in the very near future. This is super - you’ve got people excited, you’ve got a working product, and are you ready to buy? If so you would be an idiot.
Anyone can write a theory, albeit a well structured and explained theory, and you can get your white paper guys to spruce it up. Then go and hire yourself top-rated ico advisors who have the most successful number of funds raised, get some airdrops and bounty on the go and hey, presto!
Which for a lot of more canny investors, means smokescreen and mirrors, and they’re learning that artificial hype won’t give them any decent returns.
But if you look at this project, it’s getting organic hype. These guys were mainly just three founders and two of them wet behind the ears from university. But they put together their theory, they’ve been out and done a private sale and in a small time they seem to have managed to woo some serious fund money, and start gaining organic traction and interest with smaller investors across the sphere.
And in the last month or so, the effect of the partners/advisors seems to have helped them quickly expand their team to fill the holes and look credible and at the same time catch the natural hype.
The above definitely seem to be positive indicators of some real merit in product and interest here. So for me, it is definitely a runner and contender at present, one to be watching.
The main points to be on the lookout for include: the release of the prototype and reaction to it, the release of a real roadmap and not some simple graphic, and the structuring of the actual crowdsale with the detailed tokenomics.
The potential for a short-term flip - promising.
Expected long-term prospects - neutral, based on the number of technical challenges ahead and the early stage of seeing how their solutions are developed and received.
Choon ICO Review
Choon is a venture headed up by the world famous DJ Gareth Emery that seeks to establish a new working model for music makers and how money made in the industry gets distributed. Watching through the promos and explainers, he comes across as an impassioned spokesman who seems to believe in the vision.
They go to public crowdsale on July 1st. The token is a Note; they have successfully had a presale with 75 million notes, and are looking towards a hard cap of 500 million notes which would equate to USD 23 million by their figures.
Take note that they have managed to attract good funding in the early rounds and they have used that money to pre-build the product and get the community going. That is good news in itself as it means people are investing into the MVP with a certain amount of traction.
Let’s quickly go through the overall working model and logic. The underlying logic is that musicians get ripped off on every level from the manager, to the lawyer, to the record company, to the streaming service such as Spotify, and even when they do get paid, it's a long way down the road and effectively a good reason to keep a musician flipping burgers for the rest of their life awaiting the dream even if people listen to their music.
I am sure that this is not news to many people, and where Choon seeks to radically change and offer value is by using template smart contracts to simplify life and speed up income, and to charge only 20% streaming fees compared to 70% that the likes of Spotify charge.
And then for the first five years, they are going to give away a sizeable chunk of the Note Tokens to artists as rewards for people streaming their tunes, and a lesser amount over the 5-10 year period. The service will run free for the first year to subscribers to get traction and a foothold in the market. The logic is that as more people join the market, with a limited amount of tokens, demand increases and therefore token prices increase.
As a working model, a disruptor idea, a polished product, a solid MVP, and an active growing community, they seem to have it, and they have been backed by serious money to get to where they are now.
Competition in the sector, strong, but they seem to sit in a niche sector so maybe they will fare ok.
They do not seem to be getting a buzz and traction within the ICO community, so this brings up several options/thoughts, 1 - they expect people to treat this as a crowdfunded operation and they feel they have enough goodwill in their circles, 2 - the crowdsale is really an add-on, they have the cash they need, and minimal plans for future revenues, but are going for the token sale for better cash to build and for more awareness.
Either way - potential for a short term flip - neutral.
Assessment of long term potential - neutral again. It is simple token economics and use. They can be a successful business, they can be making profits but that does not necessarily mean the token supply will decrease and inflate, and waiting for years on the off chance.
I hope they do big things, I hope they make a difference but as an investor if I were going to invest, it would be on the mental basis of crowdfunding, which is an idea I support.
Medic Bee and Wankcoin get honorable mentions this week. Medic Bee has an unusual video presentation, and Wankcoin, well, maybe you should see our video about that.