Web3, the next generation internet, is believed to be the turning point that will solve issues and develop solutions to existing problems. It also opens up new possibilities for investors and project funding.
"Web3 brings changes to the field of investment. For example, DAICO. It combines a decentralized autonomous organization (DAO) and an initial coin offering (ICO). In a DAICO, investors can participate in the organization's decision-making process by voting on proposals, such as the allocation of funds for development or the release of new features. So, investors have more control and transparency over how their funds are being used while also providing a way for the organization to raise funds in a decentralized manner. The key element that differentiates a DAICO from a traditional ICO is the "tap" mechanism. It allows the investors to set a limit on the amount of funds that can be withdrawn by the development team per certain period. These principles can be adjusted and adapted and bring new opportunities, transparency, and more trust to the industry," – says Vytautas Kašėta, president of the Crypto Economy Organisation.
Forget the Current Way of Investing
A good example of a DAICO application can be the "buidl1" project. Its team created the Linear Cash Flow (LCF) protocol, which can be imagined as a stream which ensures the needed supply of "water" from investors if the project keeps its goals and promises. Otherwise, investors can minimize the flow or turn it off.
"We offer a different way to have full control over your investments because you will be able to handle and manage your invested funds. And I believe it to be the most important part. The way we invest in financial derivatives or even in crypto is as clear as day – you take a risk for a certain amount of return. But when you invest in early-stage projects, you have many uncertainties, lack of control, and greed. Our goal is to remove as many of those as possible and introduce a new way of investment to the market," – says Matas Vosylius, Co-Founder and CEO of the "buidl1" project.
Stable Funding
DAICO principles allow reducing the risk from the investor side and ensure stable funds for projects – it ensures that projects have the necessary funding to continue operating.
"The main problem for young teams and projects that gather investments is greed. That is when you get all the funds - here and now. And if your only goal was to simply get funded, then the whole development, delivery and product go into the background. That does not motivate the team to reach its goals. “buidl1“ solves this issue. You can already have finances allocated to you, rather than in someone else's wallet, where you might need to ask for the financing (when they do not deliver), but everything is in the smart contract here. Then your only goal becomes to deliver what you have promised and secure working capital," – says Andrius Bartminas, co-founder and CEO of innovation laboratory "SUPER HOW?" and one of the executive advisors of the "buidl1" project.
Milestones are used as an assessment tool to keep the investors at ease and investing accessible to adjust. Still, as in other fields, communication between the project and investors is a critical factor.
"We truly believe that the protocol we have created can build more trust between investors and projects and contribute to the growth of DeFi ecosystem. Web3 is our future and building these new solutions that enable more reliable and noteworthy projects to attract investors is our key goal. Building or, as we say, buidling is the foundation of all Web3 community. To truly change the future flow of Web3, we must work together, build trust in one another. With the right amount of skepticism and faith, the right projects and ideas can be chosen to shape and regulate the uncertain future," – says M. Vosylius.
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