Future Use Cases for Blockchain Technology: Proper Decentralized Crowdfunding

Crowdfunding is a way of decentralizing project funding by people who have creative ideas or have come up with a new product. Developing a prototype of this idea is time-consuming and usually paid out of the creator’s own pocket. Taking the idea or product mainstream requires additional funding, and rather than sticking to one or a handful of investors, crowdfunding is a preferred option. At the same time, the current model of crowdfunding is centralized, and blockchain technology can help decentralize the decentralization of funding.

The Centralized Way of Crowdfunding Today

Over the past few years, crowdfunding has become more and more popular for the everyday consumer. Even though there are still a lot of people who view backing a crowdfunding campaign as a cheap way to get a hot new item, the genuine interest in the projects is there. Every day, more and more crowdfunding campaigns go live, but not all of them reach their intended goal.

It should come as no surprise then that various crowdfunding platforms have come into life, so that project creators can be connected to potential investors. The beautiful thing about crowdfunding campaigns is that every individual can become an investor in the project, without having to spend thousands of dollars. Even the smallest contributions matter, and help the creator(s)r each their goal.

In return for pledging their funds to a crowdfunding campaign, individual investors will be eligible for rewards, either in digital or physical form. Backing a movie project, for example, will most likely include backer rewards such as a digital download of the movie, a DVD, posters, or even a mention in the credits at the end.

But there is a downside to the way crowdfunding campaigns are being conducted right now. There are only a handful of websites to host projects, which is leading to centralization of the entire crowdfunding idea. In fact, this is in stark contrast to the idea of creating a project backed by many individuals, rather than a handful of investors.

Platforms such as Kickstarter, IndieGogo and GofundMe are making all the headlines when it comes to decentralized project funding, yet in their own way, all of these platforms are centralizing the ideology of crowdfunding. Unlike most Bitcoin exchanges, or centralized traditional financial institutions, none of these platforms holds funds in advance. Money will only change hands if and when the campaign reaches its intended goal, after which card payments will be processed by third-party companies.

There are several issues with crowdfunding campaigns as well though. Nearly half of the funded projects never completes their goal of developing a physical project for the masses, yet collects all of the pledges regardless. For the investor, there is no way to charge back the money, as the chargeback grace period expired.

If there is one thing that is abundantly clear, it is that crowdfunding campaigns are a positive trend, yet they lack the transparency required towards their investors. This is where blockchain technology, with its transparent nature, could play a pivotal role in the evolution of crowdfunding.

Blockchain Technology Provides More Transparency

Platforms where creators can post their idea and raise money through crowdfunding can greatly benefit from implementing blockchain technology into their ecosystem. Not only will all investors be able to see when and where the raised money went to, but the blockchain can also be used as a bookkeeping tool.

Doing so would instill confidence in the creators of projects,a s they have nothing to hide and are willing to be open regarding how funds is being allocated. Additionally, it could use serve as a way to share project progression with the people who pledged money to the campaign, by using blockchain technology as a way to send and transfer data.

Last but not last, the blockchain can also be used for direct communication between project developers and individual investors. Rather than relying on centralized crowdfunding platforms to post campaign updates, blockchain technology allows for transparent and real-time communication between all parties.

What are your thoughts on using blockchain technology for crowdfunding campaigns? Do you see additional benefits to doing so? Let us know in the comments below!

Images courtesy of Chicago Tribune, Rude Bagette and Alphr

Police Violence and the Urgency for Bitcoin in Crowdfunding

In his "Good Cop" video for a crowdfunding campaign, activist and hip-hop artist Rob Hustle criticized police violence and corruption, calling for an end to their injustices. He challenged the popular meme that cop violence results from just a few bad apples, and argued instead the whole barrel is chalk full rotten fruit.

He would be right.

Police violence has been happening often and recorded on a near daily basis by bystanders, and now the pile of evidence against the whole institution is mounting—but the problem is not just false arrests or "brutality." Cops murder people. They have been killing people for no reason, and getting away with it by claiming they were “in danger.” Their rampant bloodlust has now reached proportions of wholesale butchery, especially regarding black people, but it is not limited to race. Everyone is at risk of being gunned down by an officer. The true war is not one of skin color, then. It is all-inclusive. It is the people VS police. So not only has the evidence piled high. The body bags have started to accumulate.

Integrate Cryptocurrency into Your Website

An issue with this escalating violence is it is tough for activists to adequately and financially combat the system. They have donors who want to enable them to crusade against law enforcement and government, but this is difficult for those involved. Why? The popular crowdfunding businesses have made Bitcoin donations inaccessible. They have not integrated Bitcoin payment methods for the people who need funds, or those who want to give them.

On Indiegogo and Gofundme, as well as other sites, if a person wants to accept Bitcoin donations they have to display their public key or QR code in the body of the page. In reality, there should be a built-in mechanism for ease of accepting Bitcoin.

Roger Ver is one such philanthropist. He enjoys donating Bitcoin to activists, but has not been able to do it easily, and has had to instruct people to publish addresses to accept the currency. This is a frustrating and time consuming process that could be easily remedied. Similarly, Mr. Hustle could not receive Bitcoin donations through Indiegogo. He had to place his address and QR code within the body of his campaign. Had Mr. Ver not been paying attention or not actively seeking to help him, this would have made donating a $1,000 in Bitcoin to the “Good Cops” campaign difficult.

Mr. Hustle has been raising funds to create the “Good Cops” music video. It will help hammer the point home that there is no such thing as a good cop. That is why he needs easy access to Bitcoin assistance via integration into these crowdfunding sites.

There have been some rumors that Indiegogo is working on integrating a Bitcoin client. But they have not confirmed this, and while they drag their feet, activists may not be receiving the funds they desperately need. How many donors might want to donate cryptocurrency only? Perhaps a lot. How many philanthropists have the time and patience to ask activists to post QR codes and public keys? Probably not very many. 

More Evil Cops and Other Activists in Need

There was another police violence incident that had a similar donation issue. It involved Michale Hoffman, who is a correspondent for PINAC, or Photography is Not a Crime. On August 12, 2014, he was simply walking on Jacksonville International Airport property to do a Public Records Request, and a brigade of costumed thugs promptly arrived and asked him to leave. He refused, citing his Constitutional rights. After quite a long argument, where Mr. Hoffman was threatened repeatedly, he was finally arrested and then underwent an expensive and unfair court case.

As a result of the expensive fees, Mr. Hoffman started a crowdfunding campaign on Gofundme. He suffered the same problem as Mr. Hustle. There was no option for him to accept Bitcoin within the company’s webpage. He has had to post it within the body of his campaign. Again, how many potential donors may not see this? And how many potential recipients may not even know about Bitcoin? An embedded application solve this issue. 

Mr. Hoffman said this about his financial situation, “I would like to leave you with this. First is about how the donations could help me. Well to say the least is the $30,000+ legal bill not including the appeal. I also lost a very good paying job over this and for several months was unemployed. Also, the money would enable me to focus more on my activism instead of working 3 jobs to catch up and pay my legal bill.”

Problems like these mean crowdfunding businesses have to make their services accessible to people who need Bitcoin. They have to step it up. The market is changing. Bitcoin is on the scene as a promising currency. Without cryptocurrency accessibility on donation pages, activists cannot challenge tyranny and press back against police violence in the most efficient manner.

This is dire. Not only do Mr. Hustle and Mr. Hoffman need help. There are a ton of people like them who need aid, especially if they are beset by crippling court costs and attorney fees, or they need their particular mode of activism funded. Regardless, just remember these are the people on the front lines. These are the people cleaning up the streets. They are the ones challenging the criminals called police. They are the modern heroes who are helping cull the rotten apples. And hopefully, when they are finished, they would have burned the whole damn barrel.

Give these people access to Bitcoin.

How do you feel about bitcoin being able to bridge the crowd funding gap?

Image source: 
freedomlovin.com
facebook.com/robhustle
NVcopblock.org