Funding Methods and Mechanisms in Public Blockchains

*Zcash is actually fee from block reward itself, meaning it’s not tied directly to use of the platform, and thus even less aligned incentives.

This is the current list of pro’s and con’s I came up with. I’m sure I missed a few, but I tried to hit on best examples of each. The trade-offs between secure distributions, legal compliance, and easy money are very obvious. Many focus entirely on just legal compliance or on just raising funding and appear to ignore the highly difficult and groundbreaking aspect of cryptocurrencies — security. Nothing is without risk, but some decisions carry far more obvious risk than others. Out of all these design choices, have to wonder what some developers really care about when marketing their “decentralized project” when their actions from the first moment of the design process suggest disregard for distribution and thus decentralization and thus security.

In theory, the ideal design would not miss an opportunity to use one of best known methods for wide and hard to game distribution. Even in the best case scenario, you still have the natural tendency of wealth concentration to address — the Pareto principle. Pareto breaking consensus design might be the unattainable but perfect goal to strive for. I’ll leave it to the reader to think about which designs at least attempt to do that.

Feel free to review accuracy or copy content without asking me.

Idea & some points came from this twitter thread by FEhrsam