Goodbye ICO, the DAICO Era Has Officially Started (ICO vs DAICO)
The DAICO is a new method for raising funds, proposed by Vitalik Buterin in 2018. It represents the union between a normal ICO (Initial Coin Offering) and a DAO (Decentralized Autonomous Organization). The goal is to minimize the complexity and risks associated with these.
ICO vs DAICO
We have been hearing a lot about ICO, but only few people know about a new method for the decentralized collection of funds, called “DAICO”: Vitalik Buterin talked about it in 2018: DAICO involves the merging of the elements of decentralized autonomous organizations (DAO) and the so-called ICOs, in order to minimize the risks associated with the second one.
How does DAICO work?
The development team that intends to raise funds for their public project builds a DAICO contract, which starts in “contributory mode” – specifying a mechanism by which anyone can contribute. Once the fundraising has been completed, the possibility of contributing to the ETHs is lost and the initial balance of the token is placed; from that moment on, tokens can be exchanged. Within the smart contract, the tap function (unit: wei / sec) is inserted, which determines the amount of funds per second that the development team can request from the contract.
|Function||Meaning||Link to the code|
|TAP||Voting to determine the increase or decrease of funds granted to the development team.||https://github.com/theabyssportal/DAICO-Smart-Contract
|Self-destruction||A vote that will determine the destruction of the Tokens and the reimbursement of the ethics collected to the respective investors
|Vote||The integration of a voting system can guarantee a highly democratic vote without weight differences as it happens with DPoS solutions||https://github.com/followine/daico|
One year passed since Vitalik Buterin talked about DAICO, but finding projects that use the DAICO – reducing the risks for the investors – is not very common.
One of the real case is Followine, an innovative Italian start-up founded in June 2017 with the aim of developing a system capable of effectively fight the phenomenon of wine counterfeiting. On their website (https://followine.io/en/) you can find more info about what is a DAICO, how does it work and how it reduces the risks for the investors.
Another project that ran a DAICO is The Abyss, a gaming platform with versatile social features and earning opportunities, designed to be your sole gateway to MMO games universe. You can find more info about this project here https://www.theabyss.com/
Last but not least, Goal Gorilla launched a DAICO to offer a blockchain based solution that will help online communities, continue to play a central role in mobilizing connection and social change. Another project website is (https://www.goalgorilla.com/)
DAICO does not mean “perfection”: but running a DAICO means offering much more guarantees to the whole blockchain investors’ community. That is why it is essential ending with a question: being given the fact that the DAICO is considered a useful tool for reducing the risks connected to the ICOs, why several projects do not use it and do not think about the investors’ needs?