Some IDO projects have shown a lack of responsibility and commitment after their launch, by not building the software or completing their projects. This has caused retail investors to become skeptical about participating in similar IDOs.
Due to the lack of accountability for teams after raising funds, and the relative difficulty in designing and building novel blockchain apps, from time to time, teams will give up and leave investors with nothing but empty promises.
We offer a solution:
Performance-Driven Fund Unlocks.
When a team chooses to use this method, they will have to determine milestones within their roadmap and outline their anticipated expenses and deliverables. In order to release the next round of funding, the team must prove to the community that they have achieved the pre-determined milestone.
Upon doing so, the next tranche of funds will be released to the team. If the team fails to reach the milestone, they will have an opportunity to appeal to the community, and a vote will be held to release further funding.
Not all teams will use this method. It will be available for teams which haven't yet built a reputation from previous successes. Teams who have already proven themselves to be responsible and follow through with their promises will likely opt not to use this function.
Please note that the on-chain functionality for this process will not be available in Coinecta on day one. We will work with the Paideia team as they bring their platform to Cardano to facilitate the milestone unlocking governance process.