“The ICOs, embodying an imperfect system, a real vehicle for speculation, are dead and are now a thing of the past “. You’ve probably heard this phrase before, but while some gloat over the death of ICOs, others aware of their shortcomings, but above all of their potential, seek to improve it. the scene for the creation of the FFPB, the engineering company Crypto4all founded by the Ozcan brothers is once again being talked about for its Tozex.io tokenization platform, the TOZ token and a new concept: Believers Reward Offering, a system where the investor is also rewarded for their commitment. But who better to talk about his project than the person himself? Rémy Ozcan, it’s your turn.
First of all, who are we?
With our 5 years of experience with Crypto4all, blockchain engineering and consulting company, we wanted to crystallize our expertise in the sector to accelerate the democratization of this technology in terms of tokenization. Innovation is central to the activities of Crypto4all because it is the heart of our technological expertise and one of the key aspects of our success.
Contrary to some, we do not consider that the funding methods based on the issuance of cryptographic tokens has no future, on the contrary.
The ICO have demonstrated the full potential of this financing method that can be used by any business, regardless of its size and geographic location.
While the amounts of ICOs are no longer as spectacular as in the past, but at our only level, we have during these last two years, raised more than $ 50 million with our different customers. The number of ICOs is lower, but they are more mature and raise amounts between 2 and 40 million, but above all, amounts in line with the real needs of the project. We even accompanied, BitBond, the first regulated STO in Europe (BaFin approval) who alone has reaped more than 2.5 million euros in July 2019. That an authority such as Bafin supports such an approach shows that we are not the only ones confident in the future of this type of financing method.
It is a powerful financing method but it suffers from certain imperfections which hamper its massive adoption with SMEs which we wanted to correct with the creation of a crowdlending system based on Blockchain technology: the Believers Reward Offering (BRO).
The reasons for the creation of Tozex.io
As one of the oldest European Blockchain engineering and consulting companies, we have been fortunate to be at the forefront of witnessing the evolution of our industry and its practices.
The promise of Blockchain technology applied to financing was to allow a disintermediation of relations between entrepreneurs and investors while ensuring the smooth running of transactions in a transparent manner at a lower cost. Building on their worldwide success (+21 billion dollars collected to date), these fundraising methods based on this technology have been victims of their success by the emergence of many players who wanted to carve out the lion’s share and on this occasion made these operations more expensive and more take a long time to set up without providing real added value.
- Too many intermediaries and the absence of an efficient secondary market
ICOs as opposed to traditional fundraisers are deemed easy to set up and inexpensive. However, the reality has become quite different. Ironically, although one of the objectives of the Blockchain is to do without a trusted third party, thereby minimizing the number of intermediaries, ICOs escape this vision.
Today, the launch of such an operation involves the solicitation of a token design provider, which means hiring smart contract developers to create your ICO smart contract for $ 600 to $ 800 per day ($ 100 / h). Beyond the high price, the entrepreneur is often unable to judge the quality of the code and the adequacy between what has been coded and the investment conditions described in the whitepaper.
Assuming everything goes well, you will then have to use the services of a consulting and marketing company to help you attract investors. Also, you will have to ask a legal professional to comply with the regulations applicable to the transaction. In the event that your ICO is successful, the expenses are not completed. And yes!, You will still have to negotiate the admission of your digital asset on a exchange platform which will not only take time but will cost you a significant amount of money. The risk is that you will not be able to offer a real secondary market under conditions acceptable to your investors.
The fragmentation of the industry and the absence of an efficient secondary market are a considerable obstacle to its development.
The lack of response to these issues through an infrastructure bringing together investors and entrepreneurs constitutes a considerable obstacle to the development of these fundraising methods. In addition, the few operational services available today are not automated, resulting in longer lead times and more expensive costs.
- The problem of financing European SMEs
Although they play a major role in the European economy, 24 million European small and medium-sized enterprises (SMEs) still suffer from a significant funding gap. Traditional finance fails to offer a satisfactory answer. Lack of reliable information, the lack of a market place for unlisted securities and the low liquidity of securities are dampening investor appetite.
Fundraising based on a Blockchain-type infrastructure makes it possible to respond to these problems and to solicit investors from all over the world. For the first time in history, SMEs have a programmable financing mechanism that allows for wider access, greater transparency and greater liquidity.
In addition, Blockchain technology allows tokenize the company’s shares and an automated update of the company’s securities movement register while ensuring a simple, fair and low-cost investment process.
Tozex.io: the democratization of tokenization
Tozex.io is a door to tokenization. Design, distribute and store digital assets (ERC20 / 771/1400) has never been easier. By automating the creation process while reducing the number of intermediaries required, the cost of the operation is significantly reduced ($ 500 to $ 1,500).
Once your asset is created, it remains easy to manage thanks to your Dashboard and to store via your Digital Asset Vault (for a low cost of $ 500). You remain the sole owner of your assets and private keys.
In the perspective where you would like to tokenize the securities of your company for a financing transaction, you can set up your ICO smart contract in minutes (ICO, STO). If the financing operation is successful, the digital assets are very quickly listed on our marketplace (5% of the assets are allocated to the liquidity fund). Tozex positioning itself both on the primary (issue) and secondary (exchange) market, an automatic listing on our marketplace reduces the cost and satisfies your investors.
Our positioning is unique insofar as there are only players who offer only part of the solution and at a very excessive cost: primary market (issue) or secondary market (exchange platform). TOZEX constitutes a single gateway to create a sustainable primary and secondary market for digital assets within the same ecosystem.
The ultimate fear, for any successful ICO, is the massive token dump, resulting from the listing on an exchange. This crash sends a negative message to the community and weakens the project. How, then, no longer be a victim of such a phenomenon? You simply need to have only investors who deeply believe in your project and offer fair treatment. This is where the BRO and the Toz token.
BRO and Toz, the combo for an ITO 2.0
The Believers Reward Offering, is the first type protocol crowdlending based on stablecoins.
This choice is not trivial and responds to the capital erosion problem caused by unstable cryptocurrencies. The price varying up or down makes it difficult for a team to know in real time the capital it has. If a project determines an amount at the origin it is because it needs it. On the investor side, the use of stablecoins allows you to accurately calculate your KING (return on investment) regardless of the current market trend.
To ensure the loyalty of investors, we treat them equally and transparently. Exit the various pre-sale bonuses and the creation of whales. The dilution of the token distribution over time also makes it difficult for pump & dump to erode the ROI of investors. We also reduce the risk of capital loss to the extent that the investor sees himself repay capital up to 50% in the first quarter.
We have chosen to link the best of the world of traditional finance and blockchain. So unlike a conventional placement, the interests are here between 10 and 15% depending on the loan duration and the amount invested by the user. Each quarter the user can choose to resell or keep their tokens. A user who keeps them, is a fervent defender of the project and is therefore assigned a bonus of stacking of the order of 10%.
The TOZ As for it does not play a limited role in funding, but is at the center of the Tozex.io ecosystem. It reimburses investors while giving them a leverage to reinvest behind on projects already listed on our platform.
The TOZ is not a stablecoin although its initial price be set to $ 1. It is also not intended to be a speculative asset, but to allow entrepreneurs to be able to finance their projects. The TOZ also allows the community to participate in the governance, by choosing which projects we will list on the platform.
We do not claim to have discovered the magic formula to correct the imperfections of ICOs, but we think we are close. The use of stablecoin for crowdlending, combined with a transparent and time-diluted distribution of tokens allows investors to minimize their risks and maximize their profits. Entrepreneurs meanwhile finally get the keys to develop their businesses while retaining possession. The BRO, because of its unique structure, pays the real defenders of a project, allows everyone to take full advantage of the advantages of ICOs. When investor and entrepreneur are united by a common goal, the assurance of a beautiful project is never far away.
Our main objective is to provide a turnkey solution by offering more confidence and transparency in this area. We will modernize raising capital by making it easier to access and improving the traditionally illiquid and costly process.
Engineering student, Community and Bounty Manager, I have been sailing on the turbulent oceans of the blockchain since 2017.
Realizing that blockchain will change our future, I too want to participate in the revolution. Find me on Bitcointalk and on LinkedIn