Project description
Capping returns to revamp initial coin offerings
Initial coin offerings (ICOs) are blockchain crypto tokens. Similar to crowdfunding models, they facilitate fundraising by appealing to the general public, offer equitable profit sharing and induce decentralised control. However, as ICO returns are unrestricted, there is an incentive for maximising profit and centralising blockchains. The EU-funded Regenerative ICOs project will investigate the notion of capping ICOs. This is expected to maintain ICO fundraising and profit sharing virtues, but remove the incentive of maximising profit whilst restoring sustainable decentralised control.
Objective
The economic incentive structures of an organisation strongly influences their governance models & power distribution, sometimes to the extent that attempts at decentralising governance fail, if they are built on centralising economic incentives.
Traditional forms of equity investing offer uncapped returns to shareholders that create strong incentives for profit maximisation and centralisation of power.
Initial Coin Offerings (ICOs) on the blockchain were designed to allow organisations to raise funding from their community and bring a greater distribution of economic gains and governance power to organisations stakeholders. However, since tokens issued through ICOs are also offering uncapped returns, current blockchain networks have become even more centralised.
There are investor reward models in traditional forms of investing that cap stakeholder profits and through that remove the incentives for profit maximisation, like (Platform) Cooperatives and Steward Ownership companies. They have shown to bring greater distribution of economic gains and governance power.
However those organisations struggle to raise (early stage) funding in the traditional financial market a Consumer investors conscious about the damaging effects of investing in uncapped public equity have challenges investing in such organisations. This is because capped investor profit models have only been implemented in the existing legal systems with significant bureaucratic hurdles, similar to traditional startup investing up until the advent of ICOs in the late 2010s.
This proof-of-concept helps organisations to run Initial Coin Offerings with capped investor profit models so they can raise funding from a diverse set of supporters, while avoiding mission drift and profit maximisation incentives. It enables more economic decentralisation, transparency and accountability, from which decentralised organisational governance can be developed and maintained in a more sustainable way.
Fields of science (EuroSciVoc)
CORDIS classifies projects with EuroSciVoc, a multilingual taxonomy of fields of science, through a semi-automatic process based on NLP techniques. See: The European Science Vocabulary.
CORDIS classifies projects with EuroSciVoc, a multilingual taxonomy of fields of science, through a semi-automatic process based on NLP techniques. See: The European Science Vocabulary.
You need to log in or register to use this function
We are sorry... an unexpected error occurred during execution.
You need to be authenticated. Your session might have expired.
Thank you for your feedback. You will soon receive an email to confirm the submission. If you have selected to be notified about the reporting status, you will also be contacted when the reporting status will change.
Programme(s)
Multi-annual funding programmes that define the EU’s priorities for research and innovation.
Multi-annual funding programmes that define the EU’s priorities for research and innovation.
-
HORIZON.1.1 - European Research Council (ERC)
MAIN PROGRAMME
See all projects funded under this programme
Topic(s)
Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
Funding Scheme
Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
HORIZON-ERC-POC - HORIZON ERC Proof of Concept Grants
See all projects funded under this funding scheme
Call for proposal
Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
(opens in new window) ERC-2022-POC1
See all projects funded under this callHost institution
Net EU financial contribution. The sum of money that the participant receives, deducted by the EU contribution to its linked third party. It considers the distribution of the EU financial contribution between direct beneficiaries of the project and other types of participants, like third-party participants.
75794 PARIS
France
The total costs incurred by this organisation to participate in the project, including direct and indirect costs. This amount is a subset of the overall project budget.