We started distributing CrowdstartCoins during the Gdansk IOTA hackathon in November this year. Each member of the three winning groups received their XSC, as CrowdstartCoins are abbreviated.
Since then we have been asked what the value of a CrowdstartCoin is. As of this writing, the value of 1 CrowdstartCoin is 0. XSC is listed on EtherDelta, a decentralized cryptoexchange, and it has been traded once – but that was a test trade in order to check whether everything is working fine.
348 Developers Rewarded With CrowdstartCoins
During the first weeks of distributing CrowdstartCoins, we have focused on rewarding developers who have added valuable code to the blockchain ecosystem. We have started to send XSC to IOTA and Ethereum developers. Other blockchain technologies will follow. As of this writing, 348 developers have received their CrowdstartCoins. Considering the very reason why we created Crowdstart Capital – namely to incentivize the future development of the blockchain ecosustem at-large, and to grow the number of developers committing code – 348 developers is quite a big number.
In the first phase, the distribution of CrowdstartCoins will be at the discretion of the Crowdstart team. In the second phase, we will set up a smart-contract-based system that will pay out CrowdstartCoins according to the accepted commits. We will programmatically monitor the git repos of major projects. In the third phase, members of the blockchain community will be able to suggest projects to be included in the incentive scheme, a model known as liquid feedback. Token-based ballots will be used to enable community voting and determine which blockchain projects should be included.
CrowdstartCoin might be worth $1-$10
Now you might ask, why do we put all this energy into CrowdstartCoins when they have 0 value? The answer is simple: We expect CrowdstartCoin’s value to rise as soon as a certain threshold of coin holders has been reached and somebody starts trading her CrowdstartCoins. We haven’t communicated our expectations regarding the value of CrowdstartCoins, yet. However, when deciding upon the number of distributed CrowdstartCoins relative to the code committed to the blockchain ecosystem, we expect a CrowdstartCoin rise in value to anywhere between $1-$10, probably within the next 12 months.
Not being in possession of the crystal ball, we could be dead wrong. Since there is no reliable method of forecasting the value of a new currency, and especially one that is not backed by any kind of asset, such as gold, the US-Dollar, etc., we base our assumption on the combined anticipated circulation supply and the expectations of blockchain developers regarding their fair remuneration when committing blockchain code.
The essence of CrowdstartCoin is to reward developers for their work. In the good tradition of Jean-Baptiste Say, we think developers will figure out the right price of a CrowdstartCoin themselves, trading the coins. Despite having some flaws, over the long run Say’s law is largely true.
We certainly don’t expect CrowdstartCoin to repeat Bitcoin’s history. But, 10,000 Bitcoins buying 2 pizzas in 2010 is a story too good not to recall!