In the first 3 articles, I focused on the structure of a Smart Media Token, a few use cases and the role of automated market makers for SMTs. In today's article I'd like to sketch an overview of what you need to know if you plan to launch your own Smart Media Token, using an ICO.
As always, please be advised that this is based on the initial version of the SMT white paper, that it may change in further revisions and that various UI implementations can group together some of the atomic operations described here.
The Basic Elements Of An ICO
Here are the most basic pieces of information needed if you want to conduct your own ICO:
- maximum supply for your token
- when are you starting your ICO, meaning from when you accept contributions
- until what time you are expecting contributions to your ICO
- when is your ICO launching - the date from which your token will be available
- when is your ICO expiring - if the ICO is not launched until this date, the ICO will be cancelled and your contributors refunded
Apart from these dates, you will also need to set up a few units.
- the smallest STEEM unit you're accepting as a contribution, example: minimum contribution is 0.1 STEEM
- the conversion unit between your token and STEEM, example: 1 TOKEN = 0.1 STEEM (that will mean you get 10 TOKEN for 1 STEEM)
After you set this up, you will have to make a decision regarding:
- minimum required participation = how many STEEM units you will need to call your ICO launched.
- a soft cap or a hard cap = the upper limits of the STEEM units you may get in the ICO
There is a difference between hard cap and soft cap.
Hard cap means that any tokens after this limit will be rejected and no new SMTs will be created. Soft cap means that any units received after this limit may be redistributed to all contributors, according to a policy you set up.
Example: if the hard cap is 10 Millions STEEM, and 11 people are contributing 1 Million STEEM each, then the eleventh person's contribution will be rejected and he will be refunded.
Example: if the soft cap is 10 Millions STEEM, and 11 people are contributing 1 Million STEEM each, it means that 10% from Each person contribution is rerouted via the soft cap policy.
Both soft and hard cap may be hidden, which means you're not forced to disclosed them. But the protocol allows you to define a minimum and maximum commitment that you want to publish. In other words, your caps can be totally secret, but you may reveal a certain range in which you will call your ICO subscribed.
Caveats And Limitations
You need to set aside a specific timeframe for your ICO. By timeframe I understand:
- time to promote it
- time to allow contributions
- time to make your tokens available and see if the ICO is actually subscribed
So the process of launching your own SMT is quite laborious and time consuming.
Also be aware that the ICO generation policy is different from the inflation, which is something you define at the token level, not at the ICO level.
And the obvious limitation is that you cannot accept anything else than STEEM. If somebody wants to participate in your ICO and they have BTC or ETH or whatever, they will first have to exchange these funds into STEEM (which translates into them also creating an account on the Steem blockchain) and after that they may contribute.
From a structural point of view, the white paper seems to cover the most common use cases, but we're only talking about pseudo-code and data types. My personal opinion is that the biggest adoption obstacle will not be STEEM limitation, or even the high entry point (I tend to think the actual cost for creating an SMT will be around 1000 SBD) but the usability of the whole process.
I'm a serial entrepreneur, blogger and ultrarunner. You can find me mainly on my blog at Dragos Roua where I write about productivity, business, relationships and running. Here on Steemit you may stay updated by following me @dragosroua.
https://steemit.com/~witnesses
If you're new to Steemit, you may find these articles relevant (that's also part of my witness activity to support new members of the platform):
One thing you didn't mention (I know you were focusing only on basic information) but I think is pretty important is that you can decide both how the ICO funds are paid out and how the new Tokens created are distributed.
For the first, you can choose to have all of the STEEM invested go to the creator or divide it up among founders or other accounts any way you choose.
For the second, I think it's important to understand that if 1 STEEM invested creates 10 Tokens, not all 10 Tokens necessarily have to go to the account that invested the STEEM. For example 8 Tokens could go to the investor, 1 Token could go to the ICO creator, and maybe 1 Token could go to some special prize fund that will be used for the ICO creator to run contests and promotions for their token later on.
I understand that these are not basic features but I think they open up a lot of interesting ideas so I think they are important for any future ICO creator to consider.
You are absolutely right, thanks for this additions, they really are important.
Can u send me link where I can create ICO on Steem ? Can’t find it
The Smart Media Token protocol is not finished or live yet so it is not currently possible to run an ICO on Steem in this manner.
I'm interested in seeing what kind of ICO's which may be created.
This opens up a Brave New World.
Great post and explanation, that makes sense and was kind of what i was thinking... gosh, i almost know what's going on! ... i'm going to have to sit down and take a rest.
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this is a great series its thanks for sharing this post :)
I can smell the RUNCOIN development hidden in your post :-)
You might be right, my friend, you might be right :)
Bravo!
You've given us very technical information in a way that is simple and understandable, that is an important talent!
Thank you, appreciated :)
ohh ! great post as well as your explanation. sometime explanation doesn't describe what we looking for or they are not understandable but you did great job. i want to say that i am bit confuse about SMT (smart media token) is this will make things easier or harder specially for the new steemains.
all i want to say ,great job keep posting.
@dragosroua - This is a very useful content for people who wish to initiate their own ICOs Sir. Love it <3
+W+ [UpVoted & ReSteemed]
ok I have read this time and time again and yet I still see no exact way to initialize the setup for my ico. any help is greatly appreciated
Serious and interesting instruction, you need to think ..
Great post @dragosroua
Valuable information you posted @dragosroua
Thank you & Have a nice day!!!
Very interesting post to read and give good instructions.
We must follow that. Great post @dragosroua
@dragosroua,
I think you should build your own ICO on this platform friend! Thank you very much for sharing such great information with us!
Cheers~
Pardon my noob question, but when you say: "if you plan to launch your own Smart Media Token, using an ICO" ... is there a way to launch our own SMT not using an ICO?
I think this is great that people have to set-up a steemit account in order to participate in a steem ICO. I wonder; however, how many people outside of steemit will want to participate in any steem ICO's, I guess only time will tell.
Great info. Thanks
Wow, I never knew I could run an ICO with SMT!
@dragosroua
Do you know any active Token or ico done on steemit blokckchain ?
or
Any ICO project is going on Steem blockchain or technology
Cool. When will it be launched? can't wait to try my own ICO