Ethically Designed ICO Campaigns

Contextual Citation

Jean Russell:

"We want an economy that rewards developers and hosts who build and support applications that the world uses on the web. To do this, we are creating a currency through an ICO.

Accomplishing this meant we had to answer several questions: How do we carry out our ICO responsibly so the ecosystem can thrive? Who are we being responsible to? How do we run the ICO in ways that honor the ecosystem as a whole? How do we reward both our initial community creating the ecosystem and the participants in the ecosystem?" (https://medium.com/h-o-l-o/designing-ecosystem-flows-for-a-responsible-ico-e30b2cc81161)

Discussion

Jean M. Russell:

"In our ICO, the crowd’s participation is just as important to us as the funding we’ll be generating. We aspire to be an ecosystem of distributed participants. That means:

• We want to make sure participation is widely distributed rather than ending up belonging to a few whales, which can often happen in an ICO.
• We need to have a way to prevent a big crypto whale from buying up the tokens by paying a premium gas fee to jump in line.
• We aspire to be an ecosystem of flows, where people are rewarded reasonably for engaging in ways that increase the health of the ecosystem.

That means:

• We want our team to rewarded for their time, talents, and commitment to growing this ecosystem.

But we must do so responsibly, balancing that with the whole. Therefore we must select a reasonable proportion for the team and put limits on “cashing out” after the jump-start of Holo.

We aspire to reward those with early faith in the ecosystem we are building.

That means:

• We can’t make speculation be the honeypot. We feel the best option is to get all participants to have some “skin in the game,” so to speak.

We aspire to raise enough funds to responsibly deliver on the promises, and the ideas put forth in our Green Paper (and other papers we created outlining the ecosystem).

That means:

• At the very least, we need one at least million euros to deliver on those promises to do work this year. As it says in the Green Paper, if the ICO raises less than that, then we will return ICO funds to the participants and seek other avenues of funding.

In order to have enough currency available for the ecosystem to flow people need to have Holo fuel to pay for hosting. In other words, the currency supply needs to relate to the size of the ecosystem. That is why the supply of the currency in our ICO is driven by the activity of backers (developers and hosts) in the crowdfunding campaign.

Given our aspirations, how do we then design the shape, structure, flows, and opportunities of the ICO to fit those assumptions and aspirations?

• Reasonable Funding: a small-but-functional ecosystem would need to be 2.5 million euros, so that is the supply we will launch with on day one of our ICO, January 23, 2018.

• Supply Linked to Demand: After that, the supply of the ICO is calculated in proportion to the scale of the ecosystem. There is a supply formula we use to describe how each purchase in our crowdfunding campaign, whether a hosting device or a developer event, releases tokens in the ICO. We described this in our post, Attuning to the Crowd.

Reserved Tokens: People who have participated in the crowdfunding through Indiegogo get first dibs on the tokens their purchase released in the ICO." (https://medium.com/h-o-l-o/designing-ecosystem-flows-for-a-responsible-ico-e30b2cc81161)