The LiboFunding Concept

10th, September 2020

Last Update :10th, September 2020


LIboFunding presents a secure way to fund new projects. Building on top of ICO and IEO concept and the fact that new projects will need to be funded, we present a new concept that will get rid of the insecurity and bad practises that exist in ICO and IEO.

The Problem

Fundraising for cryptocurrency start-ups started with the ICO which experienced a boom in 2017 and early part of 2018 with millions of dollars invested in ICOs. But there was a problem of scam and fake projects that never even kick off or became neglected after the fundraising and tokens never listed with owners running off with investors' fund. This affected almost 80% of ICO projects but as clear as the problem with this is, it was almost unnoticeable due to the 2017 and early 2018 surge in Cryptocurrency asset prices with many assets including bitcoin achieving an All Time High (ATH). As expected, the price decline in 2018 took along ICO and many ICOs were unsuccessful. To help assure investors and encourage investment in new projects, IEO was adopted. This is a lot better as projects that conduct IEO are more likely to be legit and the tokens will surely list.

As expected, the IEO became so successful as much as ICO and many IEO projects delivered a wonderful Return of Investment (ROI). But after some time and with continued price decline, IEOs stopped delivering any ROI at all and the whole system began to decline. Now many exchanges are shutting down their IEO platform and services. Should this be the case? Are we supposed to forget projects funding and just continue with existing projects? Well, the answer is NO. Because new projects will bring in wonderful and unique innovation that will help the whole crypto world. Imagine a world without Ethereum for example where Ethereum was either not financed or allowed to come into the Crypto space, even if bitcoin continue to record successes, we'll never know what we are missing and how much mass adoption push we can get by financing the Ethereum project and making it come to life. That's why new projects must always be allowed and assisted. So instead of quitting a good service because of an hurdle, we'll rather face the hurdle and try to solve the problem That's where Libo-Funding comes in;

Existing IEO problems

- Investors are not assured of ROI

- Investors don't know the project they're investing in. It's just like a gamble

- The team don't know the investors, they only take the funds so there's no sense of responsibility.

- The host exchanges are not trustworthy and so can't help the project grow Projects without use cases and good innovation are allowed, this leads to the next point;

- Some exchanges list almost a hundred IEOs at once, that's too much and isn't quality assured.

LiboFunding Protocol

Libo-Funding protocol will introduce solutions to the above listed problems, the general overview is:

- Connecting investors and team and the team will always report to investors

- Investors become a shareholder in the company and not just get the tokens but will have a share of company's profit

- Projects must have a solid and valid idea or platform or services which will be profitable and must have a use case for the tokens being sold

- There will be a maximum number of Projects allowed in a month.

How the Protocol Works

- Before listing, the project must either have a working service of the project or a real and feasible model/idea that the fund raised will be enough to actualise. In both cases, the platform or service must have a real use case for the coin being sold so that the coin is usable and valuable, the platform or service must also be profitable in nature.

- Listed projects must create a private group dedicated to their investors and all members of the team must be present in the group. The exchange will link investors of more than more than a certain threshold available on funding page to the group, they are considered a shareholder in the project. It'll be a permanent group for the project owners to have private interaction with their investors and give real time project interaction and movement, take advise from there shareholders on the project's development, give the shareholders list of any new team member for their consent (usually through voting) and potentially get more investments.

- All listed projects must agree to our terms of distributing a percentage of their monthly profit among their investors (shareholders). The percentage can't be less than 3% but can be more than that, in a month where no profit was made, then there will be no distribution. The exchange will document each investor's investment and calculate the percentage of each shareholders in the total shareholder's investment so the monthly profit can be shared accordingly. The data can be transferred to the project owners if they don't wish to distribute on the exchange.

- Each shareholder can then sell his shareholding rights to another individual.

- Only a maximum of 2 projects is allowed in the launchpad per month each using two sections (15 days) of the month, every other application will be postponed and scheduled or rejected if the owners can't wait