Swarm coin holders will receive SwarmProposal1 tokens. They must send the tokens to one of two addresses, each respectively signifying a ‘yes’ or ‘no’ vote. Voters will decide whether or not to terminate the crowdsale after the 4,500 BTC goal is reached.
Fittingly, the vote is expected to begin Fourth of July. Voting closes on July 6th. So far, the company has raised a third of its goal of 4,500 BTC. The currency, swarm coins, purchased in the crowdsale will entitle backers to future company coins.
Swarm Corp, which launched a couple weeks ago, is angling to be at the forefront of next-generation crowdfunding. It has been called the Uber of crowdfunding and aims to improve, or replace the traditional investment structure ensconced in Wall Street. It deals in “crypto-equity,” which is a new way of handing out stake. It gives businesses the option to crowdfund equity. This option is facilitated by cryptocurrencies, as you might have guessed.
The proprietary currency, swarmcoin, will be used by Swarm users to crowdfund projects. The coin could traded for cryptocurrencies or fiat, and assume a trading value, as we’re all used to with Bitcoin.
Why build something like this? As it stands, centralized finance, and even the Kickstarter-style ruled system has a reparable flaw. The company Manifesto reads:
The right to invest and innovate is in the grips of the few with the resources. They force us to ask them permission to innovate and deny our freedom to participate. This is ostensibly to ‘protect’ us from our lack of intelligence. Ironically these same ‘protectors’ would not mind if we gamble our meagre savings at casinos or on the lottery, lest we accidentally do something of value and climb a step on the economic ladder.
Swarm CEO Joel Dietz told The Economist that the mission is to democratize crowdfunding. Kickstarter has a defect. Contributors might get a t-shirt or a token for contributing, but what else? In the case of Oculus Rift, which was bought up by Facebook for $2 billion, none of the backers earned longterm holding for supporting the device at an early stage. Backers might have the joy of funding a device they wanted, but that’s not as super awesome as a reward–a stake. If Swarm Corp has a say, that doesn’t have to be the only benefit. The mission is a democratization of this system, which allows entrepreneurs to give early-stage crowdfunders–who play a conspicuous role in making the company or project successful–a slice of the cake further down the road. With this incentive in mind, this formation might encourage a hike in crowdfunding, and consequently larger pool of new products.
Swarm leverages Counterparty, a peer-to-peer financing platform which works with the block chain to decentralize financial services, as Bitcoin decentralizes money. On the platform, users can develop and trade stocks, bonds, and other financial instruments.
Swarm Corp appears to be sticking to its principles with its inclusive voting process. It will be interesting to see how this opportunity informs long-term governance of the company down the road.
Last modified (UTC): July 5, 2014 16:49