On June 18, 2019, Facebook officially released the Libra white paper, a social networking site created by the post-80s Mark Zuckerberg, which has brought tremendous changes to the global communications industry and established its own Internet empire. Today, the emergence of Libra has also had a huge impact on the entire financial industry and the encryption industry. According to the white paper, Libra’s mission is to build a simple global monetary and financial infrastructure that powers billions of people.
Facebook’s launch of Libra is not a surprise. As early as March of this year, Facebook officially announced that it will offer “FB coin” and began recruiting relevant personnel in the blockchain. Earlier, JPMorgan Chase also announced the offering of the digital coin JPMCoin. The giants of traditional industries have entered the blockchain industry, which means that digital currencies are gradually recognized by the mainstream. For Internet companies like Facebook, which have 2 billion users, “offering coin” may turn the number of people involved in the digital currency industry 100 times.
Of course, even though Facebook has already been in front of Internet companies, Mark Zuckerberg is not the first person in their family to offer coin. As the saying goes, “Birds of the same kind live together. ” What people don’t know is that as early as February 2018, Mark Zuckerberg’s sister, Randi Zuckerberg, has joined the Pledgecamp digital currency project as a advisor. What the project did was the digital currency crowdfunding that was very hot in 2017 and even brought a lot of bull market.
“Coin offering” is the only application of blockchain?
Unlike the “payment” market that Libra wants to enter, “Offering Coin” became the “only” application of the blockchain summed up by the market after the arrival of the bear market in 2018. In 2017, the popularity of Bitcoin caused a huge amount of incremental funds in the digital currency market. When people found that there was more speculation in the coin with smaller market value, a number of altcoins such as Ethereum began to rise. Since ERC-20 tokens can be offered at Ethereum in one click, ETH has once become the pricing unit of the entire industry. Unlike most projects that currently use USDT or BTC as a fundraising method, starting from mid-2017, ETC has completely become the unit of calculation for the token, both for project parties and investors, for the purpose of earning ETH. This has led to a continued decline in Bitcoin’s market share, with a minimum of only 38% (currently 68%), and Ethereum’s market capitalization has a tendency to exceed Bitcoin.
“Blockchain+Everything” is the best synonym for that era. At that time, the funds were easily circulated and not subject to regulatory restriction, in addition, the process was simple and the market lacked quality projects so that a fabricated team can raise a lot of money in the market with a simple white paper, and then the founding team disappeared. In the eyes of most incubators, it is “you can solve this problem with the offering coin.”
The soaring and morbid market sentiment quickly pushed up the market, and after reaching the peak, the market became a mess after the ICO bubble burst at the end of 2017, even though the market did not realize that the bear market had arrived at that time, but recalling that experience, we can clearly point out that December 17, 2017, is the peak of the market, followed by a bear market. In a flash, a tall building rises from the ground; in an instant, it collapses.” It is a good description of this history. The dream created by Ethereum has also become a nightmare because of greedy markets and investors.
After the market calmed down, the pioneers began to think about the essential changes brought by the blockchain and the “offering coin”. Among them was Randi Zuckerberg, the pioneer of the Zuckerberg family, who wants to make some changes in the world with blockchains. In 2017, ICO was not a completely new product. Before that, the concept of “crowdfunding” had been popular for two years. Crowdfunding is the goal, and the offer of the coin is the way. The core early-stage entrepreneurial team raises funds from the public to obtain funds to support project development. There is no doubt that the blockchain has brought huge changes to crowdfunding. As we said earlier, some of the advantages of digital currency make crowdfunding extremely simple – anonymity and anti-censorship allow it to flow quickly; In the early days of ICO, most of the projects were smart contracts that exchanged tokens directly on their official website. Investors can only get the tokens of the project automatically by sending the Ethereum contract usually, the investment can be completed in almost one click. While crowdfunding has become convenient, it has also brought huge hidden dangers to the market: the lack of transparency, lack of backer protection, lack of supervision and punitive measures, confusion in the use of funds, and the disappearance of the founding team have emerged endlessly.
Of course, these problems are not unique to the digital currency industry. These problems also exist in the original crowdfunding industry, and the high liquidity of digital currency and the influx of incremental funds make these problems stand out. Here we consider Kickstarter, the crowdfunding platform with the most brand recognition. In a study of crowdfunding projects on Kickstarter, Wharton School professor Ethan R. Mollick discovered that as many as 85% delay delivery while 14% fail to deliver what was promised. Simply put, the probability of a project going wrong is 99%.
Pledgecamp’s Introduction and Solution
The Pledgecamp that Randi Zuckerberg joined was born to solve this problem. Pledgecamp fixes long-standing problems in crowdfunding by introducing accountability and transparency with smart contracts, and by aligning user interests through an inclusive and rewarding token economy. There is not much deviation in public perception, As long as reasonable measures can be introduced, the blockchain itself is the best solution for crowdfunding, and the mechanism of Pledgecamp’s Backer Insurance + Campaign Deposits + decentralized user administrator points a way out.
Backer Insurance is a security feature unique to Pledgecamp that enforces accountability by empowering backers to monitor the usage of their contributions. A smart contract holds a percentage of campaign funds in escrow, which is released to creators as project milestones are met. Simply put, in the crowdfunding phase, the creator sets milestones for the project and selects a certain amount of funds to freeze. Just like a game, when a project is developed to a milestone in the future, the funds will be unlocked to support the next phase of development; If the project stagnates in the middle stage, the frozen funds will not be available, and backers will be refunded. This will ensure that backers will no longer invest in unreliable items. If the project disappears or the ability is insufficient to achieve expectations, the backer will be refunded.
Before starting a new campaign on Pledgecamp, creators must place a refundable security deposit prior to listing. Campaign Deposits are fully refunded provided the creator performs enough “transparency tasks” including, but not limited to, uploading business registration documents, identification, proof of contracts, intellectual property registrations, code repositories, personal references, or even answering questions on live video. Each action refunds a fixed amount of the deposit until it is fully refunded. This conflicts with anonymity, but transparency also gives investors a good guarantee of their rights. If they had to choose one, backers would surely be more willing to believe in an “honest” team.
User Moderators and Token Economy
Pledgecamp uses a decentralized management mechanism to make the whole process fairer. The listing of the project, information review, and milestone verification will be performed by the Moderator.
A jury of 12 Moderators will randomly be assigned to decide the issue within 24 hours. Their identities will remain secret in order to prevent collusion.
A consensus of at least 7 jurors is required to trigger corrective action. If necessary, additional Moderators will be assigned until a minimum of 7 votes is recorded.
Pledgecamp uses a two-token system, A two-token economy involving Pledge Coins (PLG) and Camp Shares (CS) powers the Pledgecamp ecosystem. The use of these two tokens is different, as you can see from the following figure:
PLG is mainly linked to project fundraising. PLG will be used for project creators to raise funds, pay deposits, receive rewards, and backers fund the project. Of course, don’t worry that non-digital money users will worry about the depreciation of the token or the inability to use the funds. Through the Pledgecamp mechanism, the money can be mortgaged in legal currency by credit card or other traditional means and transferred to the creator. After all, whether it is server, office rent or employee wages, most companies still pay in legal currency.
It is worth noting that in order to become a moderator, you need to pledge more than 100,000 PLG in exchange for CS. This is almost identical to the current POS, it is equal to the pledge token to obtain the rights of Staking, and can also participate in the governance of the community to obtain token rewards. If you need to revoke the moderator’s authority, destroy the CS and switch back to the PLG in a 1:1 ratio, you need to wait 30 days. In addition, if you become a moderator and do not participate in community governance, or make unfair rulings, you will be fined without rewards when reported by other moderators. Many of these mechanisms have effectively motivated most of the participants to change the pledge PLG to CS to get more rights. When the liquidity is locked, the PLG is more precious and rare.
According to the formula, the fewer people pledge PLG, the more rewards a single pledge will receive, which will reach a dynamic balance later.
Pledgecamp has a really strong team, CEO Jae Choi graduated from the University of California, Berkeley with a degree in Economics and a minor in Business Administration with a full scholarship. Jae is an expert in raising venture capital as well as dealing with government affairs. He led fundraising of Pledgecamp. Jae was also an investment banker and product manager in Ustream, an active angel investor (Robinhood, Circle, Talkdesk and other top companies) and an advisor to several blockchain projects.
President Eddie Lee has experience in raising millions of funds for startups, and he also serves as the SkyAdvisor for the famous entrepreneurial accelerator Skydeck at the University of California, Berkeley.
Zuckerberg’s sister Randi Zuckerberg, the former market development director and spokesperson of Facebook, is an adviser of this project. Before she worked for Facebook, she was a member of Forbes on Fox group. Randi brings more attention from mainstream society for Pledgecamp and pushes Pledgecamp moving forward.
David Ambroz, Executive Director at Walt Disney Television Group, brings a wealth of knowledge and business connections to Pledgecamp. As an Executive Director at one of the world’s most powerful media companies (that recently paid $71.3B to purchase 21st Century Fox), David is among the top leaders in media, business, and philanthropy.
Token Allocation and Fundraising Information
PLG total supply is 10B.
Pledgecamp starts raising money from the middle of 2018, the seed round and private equity round totally raised 17 million dollars. Public sales are about $760,000, and token price is 0.01USDT/PLG. Private equity round and seed round has some bonuses that are given out from community reserve fund.
Seed round tokens will be released after six months from PLG launching in exchange. Private equity round tokens will be released in two stages, 40% of that will be released at the first stage when PLG first launch in exchange, the remaining will be released linearly in 6 months. While the token which belongs to teams and advisors will lock for 12 months.
Currently，PLG has been launched at Binance DEX, while the price has grown 10 times (current price is $0.1). We can see from the public information that the initial circulation tokens are very few, only a small portion of public offering tokens and 40% of the private equity round tokens. Even if redistributing by IEO, the market circulation tokens are still very few.
Pledgecamp begins in a bull market and forges in a bear market. Now, a new bull round is coming, will the blockchain crowdfunding make a new revolution in the future? What we are sure about is that, with the experience in both bull and bear rounds, the market will see the differences that Pledgecamp brings to this industry. Launching Tokens is not the only use case of blockchain, but it indeed helps to solve the mixed-up problems in the fundraising industry. To support projects that are worth to support, to help excellent founders to bring changes to the world, that’s what Pleadgecamp wants to do.