The Evolution of Crowdfunding Powered by Blockchain

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Blog Crowdfunding on Blockchain

 

With the change of economic environment due to the 2008 financial crisis has given spring to the creation of crowdfunding. As post-recession funding policies issued by banks have been increasing, difficulty to obtain credit and much more complicated to get funds for start-ups and small businesses, people where seeking alternative options such ascrowdfunding, a funding methodology that has been very successful in the past decade and estimated to reach 28.8bn in market size by 2025. The successful concept of raising funds with crowdfunding platforms is relatively cheaper and an easier process, yet some issues still exist, specially related to security, trust, transparency, and transactions. The solution for these issues is the application of blockchain technology that eliminates current issues with crowdfunding platforms, a technology that the iOWNX platform utilizes to provide a secure, trustworthy and easy to navigate crowd-investing app and website. 

Crowdfunding powered by blockchain 

Traditional crowdfunding platforms merely depend on how well the app or website functions, credit card payment facility and how secure the process of funding campaigns is. Yet, we have heard of many things that can go wrong such as data breach, funds being hacked, tampered with, delays of payments or funds going through. Trusting the creators who built the platform and trusting the contract between the three parties, 1) businesses requesting funds 2) crowdfunding platform functionality 3) People funding the business, if something goes wrong at one of the points then there is a possibility of funds to be frozen until the issue is resolved. Funds security is not the only issue; data protection is a major concern in a world where data is key and an extremely valuable asset. Most platforms will require an abundance of personal information such as age, address, personal photo, gender, nationality, etc.Trust plays a major part when using a web/app-based platform as it is possible that companies can sell or share or leak data and your personal data, and that’s where blockchain technology provides a solution to all these issues and can protect all parties. 

 

Blockchain provides a powerful and secure way for information to be stored in immutable blocks. Crowdfunding platforms built on blockchain technology such as iOWNX which is the first application of its kind that is an equity-based funding platform that utilizes distributed ledger, which allows for accurate data and record keeping of all campaign activities, before the campaign is launched, during the funding stage and after the campaign is fundedThis level of visibility into a project helps all parties involved, including the seekersfunders, and platform administrators. The power of blockchain is the way it works makes it impossible to hack or tamper with information stored within it, crowdfunding platform users can find a sense of relief and comfort in using this blockchain based facility as “you don’t need to trust the creators…but you can trust the system”.  By having an immutable receipt, you can have proof of your contribution and the equity that is due to you which is something that cannot be guaranteed by the current system. 

 

Smart Contract 

The fundraising process is not easy as it requires trust between many parties as many scams and phony projects do exist on the world wide web, not only that…some legit platforms might a not have a secure system in place to secure funds between intermediaries that could be hacked, tampered with or lost. Blockchains such as Ethereum provides a secure solution for all, the “Smart Contract” which is a computer program or a transaction protocol which is intended to automatically execute, control or document legally relevant events and actions according to the terms of a contract or an agreement. – Wikipedia 

This groundbreaking commerce technology brings trust to the table as it is written in code that cannot be manipulated or changed, every step is cryptographically encoded and gets executed automatically and several other advantages over traditional contracts: 

The iOWNX platform is the core system and central place for business campaigns which utilizes the iOWN Token  which has a limited supply to fund equity based crowd-investment campaigns. The unique ecosystem will address the execution of iOWNX platform services. Users can access the platform and select the business they are interested in and fund it with the iOWN tokensThe Ecosystem will then digitally and physically execute the transactions and deliver the service outcomes to users in the form of uOWN Tokens and Smart Agreement also known as (Smart Contract). The uOWN Token is passive, nontransferable, unlimited supply Token that does not have tradable API keys. It is issued by the iOWNX Ecosystem and represents the rights to receive the revenue from a Business campaign with the trust of smart contracts.  

To conclude, a blockchain based crowd-investing platform, iOWNX has a solid infrastructure and ecosystem which is also inherently more secure, because you are not entering your sensitive financial information into a browser as you are only utilizing the iOWN token to fund campaigns, this opens crowdfunding up to any person with a digital wallet and access to the internetThe process of funding is much faster than the traditional system as smart contracts can be executed within minutes rather than days, so you won’t miss investments opportunitiesThe smart contract provides funders with an immutable receipt, which is a proof of your contribution and the equity that is due to you. This is something that cannot be guaranteed by traditional contracts and if it is, then it might take months or years through the judiciary system. 

 

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