ICO Analysis: BlockCAT
With Ethereum came the advent of decentralized applications built on smart contracts – smart contracts that require a keen computer-focused mind to fully understand. Two markets emerge: people and firms who can interact in the ___ language and software that can do the job for you. The chances are high these markets will co-exist for a long time, looking at other industries. For instance, Dragon dictation and other automated transcription applications have yet to make the transcription industry obsolete.
If the future is smart contracts and blockchains, the world is going to have a huge demand for tools to interact with money. Aragon was one of the first high quality efforts at making it truly easy for a business to on-board with Ethereum. Many businesses will simply go that route – either using Aragon or something similar to integrate with the blockchain. But everyday people who want to create their own smart contracts will see this as a lot of extra work for little payoff. For them, and for businesses for whom Aragon just doesn’t work, an early effort is called BlockCAT.
BlockCAT, short for Blockchain Complex Automated Transactions, is a decentralized platform that provides an easy to use web portal, handcrafted by our expert engineering team, to allow endusers and organizations the ability to provision and deploy the smart contracts that drive these complex transactions, zero programming required.
BlockCAT also aims to have a marketplace of smart contracts in order to accommodate legacy smart contract authors as well as those who just want to buy their contracts instead of use easy software to write them or figure out how to write them themselves. Presumably contract auditing services could easily be added as well, but this is not mentioned in the whitepaper.
The idea is really as simple as they want their user interface to be. As such, let’s get to the token itself.
Like most of these “ecosystems,” the token is a special currency that the platform will not operate without. This value proposition seems to be based mostly on the faith that the project in question will survive long enough for those tokens to have utility. As analysts we must be doubtful of most of them long-term.
CATs will also be used to pay for verification of smart contracts in the system.
Interesting Voting Mechanism
The interesting and perhaps novel thing about BlockCAT tokens is that they are used for direct authority over the platform’s developers.
CAT owners will be allowed to participate in milestone completion votes, which will be used to unlock reserves for BlockCAT expenditures.
This point acts as a method of community accountability. If CAT holders believe that milestones are not being met, they have the right to vote down the release of funds for further development. At this point, the BlockCAT team will:
[…] engage with the community for feedback to determine our shortcomings, and address those as necessary. The vote will then be repeated after a cooldown period, up to a maximum of three votes in total. In the case of three failed votes, the lock will be released at the discretion of the BlockCAT team, no less than one month after the final completion vote.
So, kind of, but not really. The community can be ignored three times in a row, and BlockCAT still gets paid to move forward. This is an important point for any investor to understand. While you have a bit more control over the platform than you would with others where you are merely a token holder and not an actual accredited investor or anything of that sort, ultimately BlockCAT is going to win the vote. It makes one wonder what the purpose of the voting mechanism is at all. You could simply commit to getting feedback before going forward, instead of giving people the illusion that they are voting.
The structure of this information in the whitepaper is telling, as well. The first place it is mentioned is as a bullet point, and then in further explanation is where we learn that the votes are ultimately invalid anyway. A legitimate vote is one that carries its result to fruition; anything short is just a discussion.
The BlockCAT team tend toward the young and Canadian. Let’s not get confused: a very young Canadian by the name of Vitalik Buterin invented Ethereum.
At the helm of BlockCAT, Eric Huang, who has a long history of translating hard technical concepts to everyday people. So much so that Forbes covered him. It’s unsurprising that he chose to apply his talent to smart contracts. Even at his young age, he’s got ten years of software engineering under his belt.
Wade Penson is the CTO and has previously worked on a project called IonDB, “an open source, key value database for embedded devices.” Huang also worked on IonDB. It’s the sort of product an end-user will interact with when they use things like network-accessible-storage devices.
They have a third member of the core team who is running media blitzes, and then some advisors. It appears they intend to hire talent once they have some funding.
This is a refundable ICO. If the funding goal is not met, all funds are returned. They have not announced what their minimum goal is, but they have a security cap of 1 million Ether. The sale is almost over, but it appears there are still plenty available to buy. The whitepaper makes no mention of the actual amount intended to be created, so it’s based on how much is purchased. Tokens are immediately issued to the buyer but blocked from transfer until after the sale is complete. This should ease the path to exchange trading.
The above is how BlockCAT intends to use the funds raised.
For their part, they will retain 20% of the tokens generated during the sale. Half of these will be frozen and the voting mechanism previously mentioned will be used to release or not release them. It appears the rest of the tokens will be on the marketplace.
Another token-based system that may or may not work out for the holder of the token. A risk sandwich with a side of potential. Extra potential.
- Cryptocurrency is nascent! Mass adoption techniques are not in high demand as of yet. Consumer-based efforts like this, even if they are for prosumers, have a long path to adoption. -1.5
- “De Facto” platform is near impossible to achieve in decentralized technologies. -1
- Smaller outfits integrating into other platforms such as Status and Aragon may find use in BlockCAT’s technology. +2.5
- In section 8.2 they mention that they will be committed to cutting costs with new decentralized technologies. This means the platform might have plenty of runway to do the targeted marketing required. +1
- As token instruments go, this one has great features: it immediately is available to you for transfer after the close of the sale, and only 10% of the total supply will be off the market. This should translate to good trading at least at the outset. We lend 3 points for this.
We reach a rating of 4 out of 10 (6.5 positive minus 2.5 negative) for BlockCAT. We foresee lots of volume on a coin like this because the issuers have relinquished significant control to the market. We stress that our numerical ratings are less important than a trader’s own intuition.
The sale is ongoing. It will end in about a couple of days, at Ethereum block 4173210. The rate is constant: 300 CATs for each Ethereum invested, or 0.0033333333 Ether each. Instructions are located at https://blockcat.io/tokensale/.