Here’s What to Look for in a Utility Token

What Are Utility Tokens and How Do They Work?

In 2017, ICO’s raised a total of $5.6 Billion, so investors may find it worth their while to learn more.

When a company uses the ICO model to raise funds, it issues cryptocurrency tokens on the blockchain. The company then distributes the tokens to buyers in return for their investment in the project. The tokens can be traded on crypto exchanges and transferred over the network.

One of the most interesting types of token is a utility token, which provides the buyer with access to the products and services a company is developing.

How Should I Evaluate a Utility Token?

Without question, all types of investment entail risk, and since it is still early days for the cryptocurrency economy, the investor is exploring relatively uncharted territory. Moreover, following the ICO, token values can be volatile, which while offering the opportunity for greater returns, undoubtedly brings an added level of risk. However, there are ways the crypto contributor can minimize their exposure, conduct due diligence and evaluate the potential profitability of a utility token.

The Viability of the Idea

The first question you need to ask when evaluating the viability of an ICO is whether the project is sustainable. To stand out in an incredibly packed field you need to consider the market for the project. Is there a current need for the product or service and is the market ripe for this development? How crowded is the market, is there room for this project within the competitive landscape?

2. The Progress of the Project

The way an ICO functions, is to raise funds for a project that is in development, so work within an existing framework makes the most sense. Long-term token success is contingent upon being able to make the product available to the public within a reasonable time frame. The more advanced the development of the project, the greater its viability.

The product should be close to market ready, preferably already being sandbox tested. Additionally, the marketing strategy should be in place, the token economy should be fully conceived, and the roadmap should show a clear direction.

3. The Structure of the Token Economy

Certain factors relating to the use case for the token and the token sale can and should set off alarm bells. Be wary of ICO’s offering sky high bonuses, token oversupply would not facilitate long term profit for contributors. What percentage of the tokens are allocated for investors, and is there a hard cap on investment? You also want to ask yourself another critical question. What is the use-case for the token and how is it being used within the business model to encourage wider adoption?

4. How Experienced Is the Team?

Who is behind the project and do they have the relevant knowhow to drive the project forward? An experienced and high-profile board is a good sign. Additionally, a team with a diversity of skills and industry knowledge relating to both the utility industry and the world of blockchain is essential

So, What’s an Example of a Promising Utility?

One utility that ticks all the boxes is the LIB token, which powers the Liberdy Data Foundation.

The Liberdy Data Foundation is a new non-profit that is designed to create a fairer digital advertising economy that rewards users for use of their personal information. Detailed and accurate data is the key to any successful online marketing effort and the company’s consent-based solution gives advertisers access to verified, first-hand data, which up to now could not be obtained outside the walled gardens of Facebook and Google. Blockchain technology offers a secure transparent and decentralized system that enables direct relationships between users and leading advertisers and as such is the core of the project.

In today’s climate of distrust for the tech giants that control our data and profit from its use the time is ripe for disruption. Liberdy is seizing the moment and taking advantage of the GDPR, new EU privacy regulation that gives users ownership of their data, which took effect on May 25th 2018. It has created a new ecosystem that places users at the center, protects their privacy, ensures the security of their data, and makes them equal partners in the Adtech ecosystem for the very first time.

The project is already in the advanced stages of development and the Data Foundation platform will already be in the pre-alpha stage with exclusive access, prior to the token generation event. That same quarter, the alpha version will be released for the user application- iOS and Android mobile apps, which will enable personal data extraction from 3 major platforms.

The token economy is well structured for the purpose of encouraging widespread adoption across the advertising ecosystem. The LIB will be used by all network participants, as a means of purchasing and exchanging user data for goods and services, without the need for intermediaries or redundant fees. Users will be paid in LIB for the use of their data and will use it to pay for premium goods and services. Advertisers will use it to pay for user data and receive it for the use of their products, while publishers will pay in LIB to enrich their monetization and receive it for the services they offer users.

A total of 300,000,000 LIB tokens is being offered, with a $5,000,000 soft cap, and a hard cap of $30,000,000 at a pricing of $0.1. Any unsold tokens will be re-allocated to the incentive program in order to grow the network.

The team behind the Liberdy Data foundation is also well balanced with a wealth of combined experience in the Adtech industry, and in blockchain development. Equally, the advisory board is packed with key industry figures with years of know how in driving startups in the digital marketing arena to success.

All these factors make the Liberdy Data Foundation a promising opportunity for investors hoping to jump on board the ICO train. To learn more about Liberdy.io please join our communities: Liberdy.io Telegram Twitter Facebook Linkedin and get the latest updates or email us at info@liberdy.io