CEO of crypto currency exchange Binance Chanpen Zhao (Zhao Changpeng) be sure that the model of raising funds through ICO preferable to venture capital even taking into account the risk of fraud.
Chanpen spoke about this in a blog entitled “the ICO is not just a “nice to have” but a necessity”. In particular, he wrote that “raising money via the ICO about 100 times, if not more, easier than through traditional venture capital funding”.
It is noteworthy that your comments on this topic head Binance published amid the ongoing scandal involving the stock exchange and venture capital company Sequoia Capital. The latter accused Binance in violation of the exclusive agreement and sued. The crypto currency exchange, in turn, has rejected all allegations of Sequoia Capital.
Zhao Chanpen noted in a blog post that startups have to spend a lot of time and effort to perform all the control requirements of venture capital firms. At the same time, the process of writing technical documentation for ICO is much less time-consuming, he said.
In addition, in his opinion, “the vast majority of professionals of venture funding” I have no notion of projects or areas in which they invest.
“Many of them have zero experience in startups and they don’t even have a basic understanding of the technology related to their field of expertise,” said CEO Binance.
Despite the fact that many of the ICO fail or outright fraud, Zhao Chanpen convinced that more such projects will be successful compared to funded by traditional venture capital.
“Most of the ICO is the launching of new projects, and they have a high failure rate, exactly the same as traditional startups. This is not something new. Most investors in ICO is already known. Investors ICO earliest followers (the disciples). More fast initiators will receive exponential benefits. Do not give up,” concluded Zhao Canpan.
Recall that for the first quarter 2018 total through the ICO had raised $6,33 billion, which is more than the entire 2017 — $5.48 bn
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