Private Crypto Funding Is Disgusting
The accredited investor laws, fears of regulators, and greedy venture capitalists are stripping the most magical thing out of Ethereum: community fund raising. I refuse to participate in it any more 🔥
The Ethereum crowd sale in 2014 was one of the most magical things I have ever seen. Thousands of people around the world came together to fund a new system at a fair valuation.
The ICO (Initial Coin Offering) mania in 2017 was one of the most diabolical things I have ever seen. Millions of people around the world flung money into any project with a pulse at insane valuations.
I loved the vibe of the Ethereum offering. I despised most of the projects that used and abused the ERC-20 standard for their own personal gain.
This fury fuelled my first viral Tweet:
I think I captured the anger of early Ethereum community well. We hated seeing the technology we contributed so much to being used to enrich a bunch of scammers.
Thankfully, the market figured this out in a few months and lots of people felt financial pain. Everyone was forced to learn their lesson very quickly.
Private Seed Rounds Create Public Dumping Grounds
The market then over-corrected to the wrong side of the coin. We shoved all the juiciest sales back into the dark. Wealthy crypto angels and high-risk funds soaked up all the deals with Docusign, email and legal contracts.
The accredited investor laws in the US are slowly being liquified. People are waking up. Everyone is realising that they are being shut out of the best opportunities in the world. It is not fair.
It is hardly a new paradigm when funds like Paradigm get to invest privately and then release “airdrops” to users at 100x the price they bought in at.
Privately funding publicly available crypto software has to stop. It is unfair.
Forgive me, for I have Docusigned
I have spent the last two years trying to rebuild myself financially, emotionally and psychologically. It was very interesting process.
Like everyone with a serious Twitter following, I started getting offered juicy angel deals. I jumped at the chance to rebuild what I had lost. I pitched in with almost a dozen projects. I invested all my free time, limited amount of capital, and all of my energy into a variety of amazing founders.
However, one thing always irked me: the private nature of the sale.
We were using Docusign instead of Metamask—why?
What is the point in smart contracts if we all use legal contracts?
Why did we build Ethereum in the first place?
Going forward, I will not be doing any more of this stuff. It is totally antithetical to the Ethereum way. I am sick of it.
I want to make two public commitments:
Every single token I receive from my private angel investments will now be funnelled into Balance and its success.
I will no longer participate in any private funding rounds for tokens that are going to go public at insane valuations for the people.
What about the Securities & Exchange Commission?
They get it. They hate the current situation where Americans are locked out of incredible opportunity. Unlike almost everyone on crypto Twitter, I have actually spoke to them face-to-face:
What do they want? Great American teams to build ethical projects in the United States and look after the capital formation process.
That is what we are doing at Balance.
We are building a fantastic product in California. We want to pay taxes to San Francisco—the city that inspires us. We want to pay payroll taxes to all the team members that are based in America.
We want to form capital in the greatest experiment in capitalism on earth.
We are trying to supercharge capitalism by using Ethereum.
No one who risk their capital on Balance will ever lose more than me if this does not work out. My commitment will always be the biggest.
That is the American way. Take a risk and do your best.
If we do not let Americans take risks, they will lose.
The American Middle Class is already losing.
Crowdfunding Equity vs. Crowdfunding Tokens
Unlike almost everyone in the world who has a Twitter account and an opinion, I can actually speak from experience on these two systems.
Ethereum wins hands down.
Wefunder is a disaster. The founders are asleep at the wheel and the project keeps breaking. They do not care about getting better—at all. I hate them.
Mirror is a marvel. It has allowed me to explore the fabric of tokenomics with light experimentation. They care deeply about capitalising creativity. I love them.
If you want to support our work, we would love to welcome you:
https://ricburton.mirror.xyz/crowdfunds/0x9500b696F00AE82CA97d06379CF0A2b60B467040
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