TBS Partners

Amber: Why we didn’t ICO

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At Amber, we love our users, and we care about our model. It’s why we didn’t ICO. We should be wary of those enterprises who do. Here’s why.

 

 

 

Why we didn’t ICO.

Because we love our users, and don’t want to rip them off.

We also give a $%*& about our business – and some stupid token created for the sake of raising non-dilutive capital will just get in the way of running the business, create pointless friction, increase the barrier to entry, confuse the end user, undermine our actual product and…that’s just got no integrity.

It’s a cash grab – and that’s not what we’re here for.

I’m sure you’ve all seen this one before.

A project like Amber does not need a “Blockchain” or “Token” to function.

In fact, that someone would do an ICO just to raise capital shows where their true motivation lies.

Jimmy Song’s article, “Alternatives to Blockchain”, sums it up perfectly in the “Venture Capital and Bootstrapping” section:

Perhaps the most successful thing that “blockchains” are good at is raising money from the public via ICOs. Not only are the terms of these ICOs exploitative of the buyers, but they’re heavily manipulated through premines, pay-for-exchange listings and other morally questionable activities.

Obviously, the companies selling the tokens like getting money, but the conditions under which they’re sold give the investors almost no protection whatsoever. This not only hurts the investors who have no guarantee of any good or service ever coming to them, but also hurts the companies that raise money this way.

I strongly recommend you read it.

 

So why didn’t we do an ICO?

 

And, Blockchain’s AOL Moment by Aleks Svetsk.

 

Conclusion

I could go on and on and on – because there are more reasons than what I’ve stated, but I think this is comprehensive enough.

I hope anyone reading understands why we didn’t do an ICO, but more importantly I hope that the path we’ve taken inspires other entrepreneurs with cool ideas to go down the path of raising capital ethically, aligning their values with the investors, end users and all the stakeholders involved.

On the flip side, if regulators are reading this, I hope they can give more thought to how they allow companies and projects to raise capital for their ideas in ways that are legitimate (i.e.; sale of equity) in a form that is more global, natively digital and available to the “everyday person”.

Whilst it’s clear that I don’t like ICOs, there is good and bad in everything.

The promise of retail investors being able to participate in investments that are traditionally reserved for the “elite” or “sophisticated” of the world is a good thing, and if the next model of token allows for this to occur for investments that are ethical and economically sound, then I’m all for it.

We hope to be involved in doing things the right way, having learnt from what went wrong in this last mania.

I will also note that I understand some protocol-level concepts could argue that they have a requirement for a token. I don’t directly dispute this, and I recognise that in some cases, it might be needed – although I do question whether or not those things make for good investments (I definitely don’t think they do).

But that’s for another article.

 

 

 

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