Balaji S. Srinivasan, CEO of 21.co, published a list of 16 Thoughts on Tokens. He summarized:
The most important takehome is that tokens are not equity, but are more similar to paid API keys. Nevertheless, they may represent a >1000X improvement in the time-to-liquidity and a >100X improvement in the size of the buyer base relative to traditional means for US technology financing — like a Kickstarter on steroids. This in turn opens up the space for funding new kinds of projects previously off-limits to venture capital, including open source protocols and projects with fast 2X return potential.
And a few highlights:
Because token launches can occur in any country, the importance of coming to the United States in general or Silicon Valley / Wall Street in particular to raise financing will diminish. Silicon Valley will likely remain the world’s leading technology capital, but it will not be necessary to physically travel to the United States as it was for a previous generation of technologists.
Tokens will break down the barrier between professional investors and token buyers in the same way that the internet brought down the barrier between professional journalists and tweeters and bloggers.
After the early kinks are worked out, the token launch model will provide a technically feasible way for tech companies (and open source projects in general) to spread the wealth and align their userbase behind their success. This is a better-than-free business model, where users make money for being early adopters. Kik is the first example of this, but expect to see more.
He ends by acknowledging it’s early, saying a crash is likely, and that things are going to change quickly. It feels like many art starting to look at the bigger picture changes made possible by tokens beyond the ICO-craze, and how it change business models, fundraising, etc. and finally:
But the world has changed. Tokens represent a 1000X improvement over the status quo, and those don’t come around very often.