What is a Milestone Coin Offering (MCO)?
Do you look for an alternative to Initial Coin Offering? A new concept known as Milestone Coin Offering is a new trend in the blockchain industry offering its benefits to startups developing tokens.
You will agree that MCO has appeared quite recently but it has been appreciated by startups which lack for launching a project officially.
Look: this article will focus on new token offering entitled as Milestone one and share its pros and cons for both sides.
What is MCO?
Milestone Coin Offering is one of the token offerings types which takes an absolutely different approach in comparison with Initial Coin Offering, Security Token Offering, or Exchange Token Offering. Any of these token offerings are based on the sale of tokens in large numbers when the project is on the point of launching. With MCO, things look different since this type of token offering has been created especially for startups which lack money for the completion of their project. According to the statistics, only 1 in 10 projects manage to find enough financial support to release the token they worked on. MCO is meant for young startups which can offer a certain portion of tokens for sale when they reach a certain milestone in their project. Setting and reaching goals they also receive investment into their project and continue to develop it.
As a result, this token offering can be called more goal-driven rather than money-driven. Consequently, the quality of the final product (token) turns out to be much higher thanks to that. Moreover, the main purpose of this offering is to build the community by attracting funds to the future project and confirm the professionalism of the development team. This type of offering also allows achieving multi-phased funding from multiple investors by organizing several token sales or split them into multiple batches and sell tokens in small amounts.
MCO pros and cons
Like any other token offering type, Milestone Coin Offering is not perfect though has its unmatched benefits.
What possible obstacles can be faced by investors and token issuers using this model? Investors still risk their money since there are chances for the project not to be completed while tokens obtained will lose their value. Moreover, startups cannot verify who is an investor of their projects, while token investors may be concerned about the dilution of the coins since their number increases in the pool with every new round.
At the same time, this type of offering is a trump card for young startups who desire to develop top-notch products but simply lack money for that. Moreover, they can attract the attention of multiple investors to their future creations working on the token. As a result, the blockchain industry will get out of the bear market and give way to promising entrepreneurs.
Successful startups using MCO
Though there are not many companies which have tried Milestone Token Offering as a means of fundraising, a true example of Storecoin confirms that this offering can be rather advantageous.
Storecoin is a free public blockchain which offers STORE coin for sale. According to the website, the platform is going to have from 1 to 3 MCO before the launch of mainnet. Interested people can also learn information about the development team and advisers, current investors, partners of the startup, reviews, benefits of choosing Storecoin on the website and much other useful information about the blockchain. There are multiple milestones reached by the company since January 2018 and with every new milestone, the coin value was growing too. As a result, everyone can see that this startup managed to benefit from MCO and achieve success.
Milestone Token Offering is a perfect way to break the monopoly of investors and provide young entrepreneurs with more opportunities for their project development. It means that thanks to this type of offering the blockchain industry will get more backed up tokens of better quality. However, it is still difficult to predict if MCO manages to get that popularity and become a viable business model like other token offerings.