FCoin founder Zhang Jian answered several prominent questions regarding the FCoin token economy.
Q1: FCoin has released many articles lately and raised several new concepts. Let’s discuss FCandy first. FCoin will distribute FCandy in place of FT (FCoin Token) in the future. What does this mean? Where do you think FCandy’s value lies? What is the price expectation for it?
A1: FCandy is actually an asset pool, which we filled with a large amount of FT tokens in the initial stage. This initial funding is actually a donation of assets, and the intended value of this design is to let community users share in these free benefits. Based on the tokens you contribute to the pool, a proportionate amount of FCandy will be issued at a discount. What is interesting is that the FCandy issued does not belong to the token contributor, but instead belongs to FCoin’s community users. We have provided announcements detailing the contribution and distribution plan; the FT tokens contributed will be returned in the future. This strategy will not change. FCandy is issued using a “locking as mining” mechanism, and its price can be calculated according to the information on our homepage. The price appreciation expectation is high in the long term.
Q2: What are the latest rules on token issuance? Does the newly launched FOne transaction community delegate the token-issuing right to sponsor institutions? What are the standards for selecting those institutions? How do they differ from sponsor institutions in the stock market in terms of duty and responsibility?
A2: The latest token-issuing rules indeed have some major changes, specifically the recently launched FOne. The FOne community was put forth for two reasons. First, the Growth Enterprises Market (GEM) is under a lot of pressure and the large number of projects in the application queue is far beyond our expectation and the exchange’s service capacity. Second, the GEM itself has no sponsoring ability and cannot determine whether the project is good or not. Duty and responsibility are very important here. Sponsor institutions have a specific area and are responsible for project supervision and guaranteeing their quality. In their specific area, they have the right of token issuance and rule formulation, while FCoin only provides them with the underlying services.
The intention of FOne is to find better projects through supervision and screening, furthering the expansion and growth of the FCoin ecosystem and brand. At present, we are focusing on mainstream Token Funds and will expand the scope later. As to the standards, we will widen the entrance but strictly control the exit. Any reputable Token Fund is welcome to become a sponsored institution, but the selection and review process afterwards will be thorough. The ecosystem of the token industry is not mature and many aspects remain tangled. We are working to introduce tried-and-tested models to tame the chaos and make incremental progress. The application process is open today and any institution can apply so long as it fits the conditions.
Q3: Is FOne FCoin’s experimental zone for reverse ICOs? How is it different from the token-issuing and circulation mechanism on main boards A and B? If a mature product or enterprise wants to carry out a reverse ICO, what are the biggest hurdles and challenges? Are there any success stories? For a mature enterprise, ensuring token issuance conforms to applicable law is a sensitive topic. Will this be one of the main obstacles to the reverse ICO experiment? How will you solve this problem? Which industries do you think will succeed first in the reverse ICO experiment?
A3: FOne is not an experimental zone for reverse ICOs. Reverse ICOs happen on main board C. We already have main boards A and B. Board A features mature blockchain projects, while board B includes emerging blockchain projects and board C focuses on reverse ICOs. To be precise, FOne is the successor of GEM and will be positioned to specifically support startup projects, while GEM remains responsible for growth projects.
The difficulties facing reverse ICOs depend on several factors including project preparations, qualifications, and the maturity of the business model and scenario. To put it another way, the reverse ICO applies to two types of enterprises: those with well-prepared, mature models, and those that have mature business model but no concept of tokenization and consensus. A reverse ICO is not difficult for the first type, but for the second type, token economies can conflict with the older business model. Moreover, it takes significant effort to communicate the design, original interest distribution, shareholder structure, and resources of the token economy model; consensus can only be reached if the enterprise is able to upgrade its perception.
As to compliance, the more disruptive something is, the more sensitive the issue becomes. We are witnessing tremendous change. A token economy changes the market relationship and that is a challenge we cannot circumvent. As a future trend, token economies are bound to encounter strong resistance in the early stages of growth, but we will continue to press ahead together. I believe enterprises in the Internet and financial industries will take the lead in succeeding in the reverse ICO experiment.
Q4: Many organizations are dabbling in blockchain and insurance, but this approach has not been widely adopted so far. Is the new insurance community FInsur just for show? Is “insurance as mining” a benefit offered by the platform just to attract users or an insurance mechanism in the real sense that is based on blockchain technology?
A4: The FInsur project is not just a publicity stunt. Customers of FCoin are both traders and representatives of the core concept of token economies. We make traders “shareholders”. Likewise, with FInsur, we make insurance applicants “shareholders” of insurance companies and they have consistent rather than opposing interests. In fact, the absence of insurance in the digital currency industry is somewhat appalling. FInsur is something that FCoin must do. The token circle has seen frequent security incidents and we must give users a guarantee. FInsur will be a landmark innovation in the industry, creating immense benefits for users.
Q5: What hidden or public rules have FCoin changed?
A5: There are no hidden rules; we are completely transparent with our data. The exchange homepage displays its transaction records, from which we can analyze the daily profits. We are doing this because 80% of the profits will be returned to the community members, and information must be made public to ensure it cannot be forged. This is in line with the initial intent of blockchain technology. This mechanism will challenge the hidden and public rules of others in the industry. Some people like to comment that we collect exorbitant profits, but 80% is returned to the community. The change this model brings to the industry is only just beginning… just wait and see!