I started looking at blockchain from a position of extreme skepticism. Over time, mostly thanks to friends like Julien Genestoux and the amazing team over at DADA, I've come to a better understanding.
I've always been interested in decentralization as a general topic, of course - the original vision of Elgg had federation at its core, which is something I experimented with in Known as well. I'm also an active Mastodon supporter. It just took me a lot longer than it should have to see the implications in blockchain to actually bring those ideas about - mostly because of the very broey, Wall Street veneer of that scene. I don't need to be associated with the modern day Gordon Gekkos of the world; that's not what I went into technology to do.
What I did go into technology to do is empower people. I want to connect people together and amplify underrepresented communities. I want to help people speak truth to power. And I want to help create a fairer, more peaceful world. Speak to many founders from the early era of the web and they'll say the same thing.
By decoupling communications from central, controlling authorities, decentralization has the potential to do that. For example, the drag community was kicked off Facebook en masse because they weren't using their government-sanctioned names; that couldn't happen in a decentralized system. On the other hand, it's almost impossible to flag problematic content in such a system, so it could also allow marginalized voices to become even more marginalized with no real recourse.
But ICOs are really interesting. There is a well documented demographic bias in venture capital: it's significantly easier for well-connected, upper middle class, straight white men to receive funding. That's because most funding comes via existing connections; reaching out to investors cold is frowned upon and rarely works. The result is that only people who have connections get funding (except at places like Matter and Backstage that explicitly have an open application policy).
ICOs might be a different story. They are (theoretically) legal crowdfunding mechanisms that allow anyone to raise money, potentially from anyone - without diluting ownership of the company. Assuming you can pull it off (which is likely also dependent on having the right connections), you could potentially raise tens of millions of dollars without having to prostate yourself to Sand Hill Road. It's potentially very liberating.
But I need help understanding some of the mechanics - and I suspect the community in general does, too.
In a traditional venture relationship, investors don't just bring money. They also bring expertise, connections, ideas, and sometimes even a shoulder to cry on. Your investors almost become like cofounders, and you build a relationship that lasts for many years.
In an ICO relationship, it seems to me that the incentive is for investors to dump their tokens almost immediately. You put your money into a presale, you wait for the price to go up, and then you immediately sell, because you don't know what's going to happen in the future. The good news is that you have your presale takings, but the potential for the post-ICO dump to irreversibly crash the price of your tokens seems high - which would effectively prevent you from being able to raise money in this way again. Not to mention the fact that you don't really have any kind of relationship with any of these investors. It's dumb, fickle money.
Equity is scary - you're giving away part of your company. But it also aligns investors with your mission. You're in the same boat: if you succeed, they succeed. At the extreme end, there's potential for certain kinds of investors to push you into unhealthy growth so they can see a return (sometimes employing toxic practices like installing their own HR team), but in general, I do believe that most investors are in it for the right reasons, and want to see companies succeed on their terms. I don't see an equivalent to the non-monetary side of the equation in the ICO world, and I worry that teams will suffer as a result.
But potentially I just don't understand. Just as a my friends helped me get my head into blockchain, I'd love some help with this, too.