SAN FRANCISCO (PRWEB) December 02, 2017
DropDeck, a digital platform that coordinates funding for small businesses, is introducing a new currency. Known as Decentralized DropDeck or DDD tokens, this cryptocurrency will become available on November 21st.
DropDeck takes advantage of the Ethereum blockchain to design smart contracts, secure payment records, and other tools essential to obtaining and safeguarding funding for new ventures. The platform makes it easier for new businesses to find funders who are willing to fund their activities, while helping those funders be confident that their money is going to a worthy venture. It also compensates those who conduct due diligence on behalf of fundraising companies, as well as those who evaluate and publicize information on the ventures looking for funding.
By introducing DDD tokens, DropDeck hopes to ensure reliable payments for funders, evaluators, and due diligence delegates. It also seeks to change the incentive structure, giving all users a financial motivation to look out for the good of the platform. Once the currency becomes public, everyone who holds it will have a vested interest in the platform’s popularity and quality.
An Introduction to DropDeck
DropDeck was created to resolve one of the most serious limitations facing startups: uncertainty. For new businesses to arise and expand, entrepreneurs must have access to loans on generous payback terms. This means they need to look for funders who will take an interest in their projects and whom they can trust to fund them consistently until they become profitable. Likewise, funders need to find business ventures that are likely to turn a profit soon enough to make their investments worthwhile. Both parties thus need to find accurate, detailed information on each other.
With DropDeck, these two parties can obtain the information they need with ease and be confident that it is accurate. The platform guarantees these results through:
Blockchain Access-control- DropDeck uses blockchains from the cryptocurrency platform Ethereum as an access-control center to its data storage used for machine learning. Blockchain technology is a method of storing information that links records together into chains. If one link is tampered with, the whole chain changes. As a result, it is effectively impossible for startups, funders, and third parties to falsify the information listed on the platform, making everyone confident that it is accurate.
Evaluator Incentives- To gather data for the blockchain, DropDeck gets evaluators to vet every funder, startup, or other business that uses the platform. Whenever someone needs this information, they have to pay the evaluator for it. Poor evaluators lose trust scores over time and are removed from the ecosystem. This gives evaluators an incentive to gather as much valuable information as possible. It also coordinates payments for funders' representatives who conduct due diligence and other necessary legal arrangements.
Smart Contracts- DropDeck creates self-enforcing or “smart” contacts by programming specific instructions into the blockchain on when to distribute payments. This means that evaluators and due diligence delegates can be confident they will be paid for their services as soon as they provide them. Likewise, startups will get their funding as soon as funders agree to provide them. For their part, the possibility of funders being rewarded for their contribution is maximized by the built-in incentives.
Not only does DropDeck allow startups to get funding more quickly, but it lets them seek it all over the globe. At present, international investment is limited by uncertainty about what happens across borders. funders don’t know whether they can trust foreign businesses to repay their loans, while startups have trouble telling if foreign funders will be interested in their ventures. By helping both parties contact and vet each other from any location, DropDeck fosters trade, international partnership, and global prosperity.
How DDD Tokens Enhance DropDeck’s Efforts
As effective as DropDeck’s smart contracts are, they only work if funders and startups have first made their money available to the platform. If a funder wants to withhold some of its loans or a startup doesn’t feel its funder deserves the royalties they demand, they could always refuse to upload funds in the first place. There would thus still be uncertainty on both sides, limiting the number of successful transactions.
Introducing a proprietary cryptocurrency will allow DropDeck to keep this uncertainty to a minimum. Rather than allowing startups and funders to pay in Bitcoin, Ether, or national currencies, the platform will require them to buy DDD before they can begin transactions. Their DDD balance will then be stored in the platform, with the blockchain keeping an immutable record of how much they have left. When one party fulfills its obligation under the smart contracts, the platform will automatically transfer tokens to them, leaving no chance to skimp on payments. The same goes for evaluators and delegates, who will receive DDD the moment that someone purchases their services.
In addition to facilitating swift, reliable payments, DDD tokens will give everyone involved in the platform an added incentive to do their best possible work. Because tokens are necessary to use the platform, the more companies want to work through DropDeck, the more demand there will be for them, driving up their price in other currencies. This means that evaluators, startups, due diligence delegates, and funders who already hold tokens have an incentive to make the platform as valuable as possible. Funders will thus have to offer generous loans on reasonable repayment terms, while startups will need to use these loans responsibly and report their finances accurately. Similarly, evaluators will have an incentive to gather data that is as accurate as possible, while delegates must perform due diligence comprehensively and effectively. The better each party is at fulfilling their duty, the more the tokens will be worth, giving funders, startups, and evaluators a clear reward for their good work.