Crowdfunding has always been an active way to raise funds for development projects. With many technologies coming around today, the traditional crowdfunding method is likely to be replaced by Decentralized Crowdfunding Platforms. Yes! It is possible to host a funding campaign without any intervention of a third party between the host and the public.
Blockchain technology is a digital ledger that records transaction information in a network that can never be hacked or modified. So What is a Decentralized crowdfunding platform? How does Decentralized Crowdfunding with blockchain is revolutionizing the centralized funding process globally? Here is a blog specially curated for you to gather insights on the same.
Difficulties in centralized crowdfunding
Technology always offers a better solution, overcoming the challenges in the existing traditional method. Crowdfunding campaigns through platforms have many challenges. It makes it inconvenient for small scale startups, creators and artists who are struggling to see the limelight with funds from the public. Here are some challenges and also the solution from the blockchain in the latter part of the blog.
⚡ Centralized crowdfunding platforms often ask for a listing fee from the project holder or take up a percentage of the fund raised through the platform. This not only restricts the funding limit but also the small inventors who wholly depend on the public funds. As a result, the centralized third party is taking up a part of the fund which should be rightfully owned by the project holder.
⚡ It is not just enough to put up your project on the platform, it is also important to market your crowdfunding campaign. Only a few centralized platforms offer a separate page for featured and trending projects.
⚡ Since the project is simply put up in a centralized platform open to the public, the project is subjected to copyright vulnerabilities. This makes it difficult for small innovations to come out slowly which is hoping to grow big in the near future.
⚡ There are also rules and regulations imposed by the platforms which makes it inconvenient for few projects to comply with them.
Blockchain is a digital ledger that stores the transaction details to every node of its network and makes itself an unhackable and unmodifiable technology.
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Decentralized crowdfunding
A decentralized Crowdfunding through blockchain overcomes the above challenges and offer a better opportunity for blooming projects, artists and others who are hoping to reach the public for their funds. With the popularity of blockchain technology, this solution is slowly becoming the new normal in terms of crowdfunding campaigns.
⚡ Decentralized crowdfunding is the most transparent way to raise public funds. That is, what is raised from the public directly goes to the project holder without any third party commission. Crowdfunding is not based on any platform, instead, the smart contracts take up and process the transactions.
⚡ It is highly accessible by people across the world. The transaction is completely based on crypto tokens or currencies online. It is also possible to accept fiat currencies.
⚡ There are no rules and regulations for the project holders as the system is completely decentralized and it is on the public to invest in the project.
⚡ The project will not suffer any copyright vulnerabilities because blockchain has the ability to provide exclusive ownership to the projects and no similar projects can be owned by two different owners.
⚡ As blockchain is emerging, people are interested to invest in this new emerging technology. Decentralized crowdfunding offers a showcase of projects and their functionality on one hand and offers an opportunity to the public to fund the new projects.
Developing a Decentralized crowdfunding mechanism for your project is not as tough as you think.
Developing a blockchain-based Crowdfunding
Blockchain-based crowdfunding is trending with the popularity of cryptocurrency and its ability to provide passive income. People who invest in crypto-based crowdfunding in its early stage earn a passive income. People buy crypto tokens contributing to the funds during the early stage of the project. Once the project is out or launched, the tokens get a hike in their value and people sell these tokens and get better returns.
This has attracted a huge crowd of audiences to the crypto field. Crypto exchanges of course offer passive income, but this method offers better returns. There are many blockchain-based crowd fundraising modules. They are
1. Initial Coin Offering
2. Initial DEX Offering
3. Initial Exchange Offering
4. Security Token Offering
5. Initial Farming Offering
6. Initial Liquidity Offering
7. Initial Insurance Offering
Why us?
At Inoru, we have a team well versed in blockchain development and blockchain-based crowdfunding. With years of experience, we offer best in class solutions and bring out the best for your project. We offer
⮞ Transparent development process
⮞ Technical guidance
⮞ Post-development marketing
⮞ Round the clock client support
⮞ On-time delivery
⮞ Highly secured solutions
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Takeaway
Blockchain is an emerging technology and people are slowly taking up blockchain technology in everyday life. Many small and medium scale businesses in the US have already started taking cryptocurrency as a mode of payment. This is a sign that it is creating a new revolution in the financial industry. It is wise to go with Decentralized Crowdfunding Platform Development and start the race early.