How Enigma could enable secure ICOs and make privacy tokens the new Standard
Guys, Enigma is really worth seeing! Please inform yourself about the project. Here is a part of the blog post from the Enigma Blog. Enjoy your reading.
Initial Coin Offerings (ICOs) have taken over the crypto world. For better or for worse, the issuance of utility tokens (and in the near future, security tokens) continues to expand. With approximately 1600 tokens listed on CoinMarketCap.com at the time of writing — and more being added daily — token issuance has already had a dramatic impact on the world in general, and the crypto space in particular.
A major contributor to the meteoric rise of ICOs was the introduction of Ethereum — the first widely adopted smart contracts platform. With Ethereum, issuing a new token based on arbitrary rules (e.g., supply, cost-per-token, soft and hard caps) was made simple from a development perspective, and fair from the perspective of the users. By fair, I mean that the terms set in the ICO contract are being followed to the letter. If, for example, the smart contract defines that for 1 ETH sent to the contract, you will receive 100 NewOrg tokens, then you can be certain that this convention would be followed.
However, while this mechanism has worked well, it falls short of an ideal solution. Traditional ICOs still pose significant security and privacy risks to both the coin issuer and the buyers.
As discussed in my previous post on Secret Contracts, the problem today with all blockchains is that information that’s stored on the ledger — including smart contract data — is completely public. In the context of an ICO, this means that once the token smart contract is initialized (i.e., the Token Generation Event), the full distribution of token holders become publicly visible. In other words, everyone — including the swarms of potential hackers trying to separate people from their funds, can see precisely the holdings of each wallet — and therefore of each individual.
If you want to continue reading, please do so on Enigma's blog or on Enigma.co
https://blog.enigma.co/secret-icos-and-privacy-tokens-d77ed505514d
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