ICO Analysis: KICKICO
When we analyzed Adel, a platform which crowdfunds and promotes start-ups from within, this author wrote:
So it’s a decentralized Kickstarter? So what!
The above is a reasonable reaction. But let’s consider that Kickstarter’s worth is estimated by some to be as high as 1.5 billion. Kickstarter is a closed, centralized platform, which means its growth is limited by such things as staff requirements – you need someone to review the projects submitted and, worst of all, you need third-party payment rails. Kickstarter has never integrated Bitcoin.
Thus, we approach KICKICO with the same premise, but more aptitude in the above assessment – a decentralized Kickstarter is precisely what KICKICO aims to be – thus, the name.
We could end the analysis right here saying that the odds of success on this thing are as high as the odds on other meta-cryptocurrency projects – middling. But that wouldn’t be fair to the people who are putting their time and energy into the thing, so let’s have an in-depth look.
No business should exist if it’s not solving problems. The problem that KICKICO identifies to solve is the rash of fraudulent ICOs that have arisen as a result of successful ones. You’ll see this in anything: if there is a good version of it, there is also an evil version of it. We’ve caught a couple here, most notably the Eros.Vision debacle.
In their whitepaper, KICKICO write:
However, this is a new frontier and there are no regulations around it. As a result, there are many fraudulent campaigns, where founders disappear after they have raised funds, essentially scamming the public. […] The founders of ICOs also face problems. The space is currently very fragmented, there is no comprehensive list of ICOs, and developers must create their own landing pages and publicity campaigns from scratch. This reduplication of effort wastes time and resources that could otherwise have gone into developing a better product.
We can argue that the last bit of justification in the above passage robs business owners of a certain right of passage. Earning their way the old-fashioned way, garnering reputation through actually meeting people instead of gaming a crowdfunding platform, speaks volumes about start-up founders and operators. The prospect of platforms on which to launch ICOs in a more reputable manner is an interesting one, but we must keep in mind that we are dealing with an incredibly nascent trend, and the need for this type of platform is even more nascent. Here are some other platforms which aim to do the same thing:
Of these and the others that will come along, only one will truly emerge as the industry-trusted standard. Such a position is really wide-open for any major exchange with a track record of not scamming people. BitcoinSuisse ran the Tezos ICO.
Is there anything really special about KICKICO? Not particularly. They have good design. Being based in Eastern Europe, they can probably help up and coming talent that may not have vast resources to draw on for getting started on their own. Maybe some great projects could come out of it. But is it the sort of thing we should put our money into? Well, let’s talk a bit about the team, how the token works, then about how much actual cash they’re trying to raise, and then determine if this is the sort of thing that’s going to earn you a payout long-term, short-term, or at all.
A socially-motivated investing plan needs great people. Not just good people, not just skilled ones. They need great people that can convince the next Ethereum to launch their ICO on KICKICO, or to draw in businesses that need more investment but don’t have access to traditional means, and so forth. Is this what the team here is composed of?
At the top there is Anti A. Danilevski, who prefers to call Saint Petersberg by its Soviet-era name, Leningrad, as he writes in his bio:
Born in Leningrad, 1980, began his work in game industry at 14. Since that time, have been working on indie titles and browser-based games, one of which (Carnage) became the most popular game in Russia. Since 2011, he has been the foremost crowdfunding evangelist in Russia, and helped hundreds of crowdfunding campaigns around the world.
Last month, he wrote an article on Medium.com in which he said:
Anyone can launch a crowdfunding campaign, offering anything from a tin whistle to a time machine, and post it online. They don’t need professional qualifications, they don’t need proof of competence, they don’t even need a product. They just need videos, pictures, and text. […] While crowdfunding 1.0 did launch some cool and successful projects, like the Pebble smartwatch, it’s inevitable that such an unregulated marketplace has a large share of charlatans and bunglers. And when a project fails, Billy Backer has no recourse, unless he takes the campaign creator to court, which is out of the reach of most people, either because of their financial means or because they’re located in a different jurisdiction.
Danilevski’s bio claims that he runs Russia’s “largest crowdfunding community.” According to Wikipedia, the largest crowdfunding site in Russia is Planeta.ru, which has no mention of Danilevski and says on Wikipedia is run by musician Max Lakmus. However, Danilevski runs a large crowdfunding group on Facebook.
As to the rest of the team, there are no real stand-outs as great.
The token on this platform has a serious drawback, we should dispense with any nonsense and just get that out of the way. The KickCoin token is not required to make investments in the KICKICO platform. Further, KICKICO intends to generate a lot more tokens over time. While they won’t use tokens that aren’t issued for projects funded (more in a moment), this is just an insane amount of tokens to generate, guaranteeing mass inflation as a best case scenario:
People get tokens by investing Ether into ICOs on the platform. They also get whatever tokens a particular ICO is offering. According to KICKICO themselves, successful ICOs are going to, magically apparently, generate value and interest in the KickCoin tokens, so that they can be redeemed at exchanges. This would be the only incentive to buy such coins now, after all.
The formation of a large number of projects participating in KICKONOMY is the basis for the growth of the cost of the KC: if more games, services, shops and other businesses will use KC, the more demanded and the higher their liquidity will be. KICKICO is building its business model specifically on the creation of such projects, increasing their number and connecting existing ones to KICKONOMY. However, not only this will positively affect the cost of the KC. Cryptocurrencies are very sensitive to significant events, and we understand this.
There is no reason to buy these tokens. Whether KickCoins perform well or not, the only real offering here is later investment opportunities that may arise as a result of the platform. It’s not worth taking any risks in order to create such a platform, since others will certainly rise regardless.
- The only time we should be willing to gamble on something whose value will be reputation-based is when the people offering that wager have a long and vast reputation. -1
- Failure to require the token for investment, and serious inflation as an economic plan, costs this ICO seriously: -4.5.
- KICKICO as a platform may be worth watching, as it could provide us some lucrative opportunities in the future. However, it’s going to have to find its own way to operate – one hopes that its 4% fees will be enough to cover operations. +4
- The massive size of the growing cryptocurrency space is likely to make favorable waters for literally anyone navigating them. As such, we can give KICKICO some timing points: +2.
We need platforms like KICKICO in the cryptocurrency world, but we don’t need to take risks for them to come about. There is not significant benefit to the KICKICO investor – KickCoin tokens may as well be tokens of thanks since they have no strict utility. No amount of marketing or buzz can make something that is ultimately useless hold value. Numerically, we just can’t find enough redeeming things about KICKICO to rate them any higher than 0.5.
As always, this is one myopic analysis. There may be things the author doesn’t know, didn’t notice, or wouldn’t be considerate enough to evaluate. Nonetheless, in this project we find significant risk for all participants, so significant that we would not put our money there at all because the chances of reward are poor.
The KICKICO initial coin offering for KickCoin tokens launches Aug 29, 2017 at 1:00 PM UTC. As usual, it is advised to keep track of their social media channels and ensure you are accessing their official website (https://www.kickico.com/) as (if) you go to invest.