A comparison between two recently successful ICO’s: BTT and LTO

On a fundamental basis these two projects could not have been further apart, but they do share one similar characteristic. Each had a tremendously successful ICO and drew in a lot of investors. So, where does this success come from and which token is most likely adopted?

In the next section I attempt to answer each of the previously mentioned questions based on desk research I have done for both BTT and LTO. In order to avoid bias, I invite you to do the same. For both I have visited their respective telegram channels to get the following questions answered. My experience in both telegram channels (which traditionally act as hubs for all investor-related talk) vastly differed however. I will leave these up to you to find out: LTO Telegram | BTT Telegram.

Is there a finished product or solution?

LTO: Yes, LTO Network main product is something called Live Contracts. These essentially make it possible to automate a lot of procedures and agreements between businesses in a decentralized workflow. It is aimed to reduce administrative work substantially without changing the legacy systems they rely on. More on product focus in 2019 can be found here.

BTT: No, scheduled launch for BTT takes place in Q2. For now the only implementation is being able to use BTT in Tronbet — a gambling dapp. In Q2 one should be able to enjoy higher download speeds using BitTorrent when having the BTT token. This feature is called Bittorrent Speed and should be one of many dapps to be developed for the ‘Bittorrent ecosystem’. What this ecosystem will consist of remains unclear as these decentralized apps are not build yet.

2. Is this product or solution used? If yes, by who? If no, what are the odds it will be used over time?

LTO: LTO currently has dozens of real-world clients and partners, including Heineken, Deloitte, the Dutch Ministry of Justice and many more. LTO’s solution called Live Contracts is also a frictionless, scalable solution which makes implementation for future real-world clients an easy affair.

BTT: As there is no solution yet, the product is not being used yet. BTT can however be used for Tronbet. Tronbet is a gambling Dapp which has around 6.2k users at the time of writing (source: dappradar). An estimation of the odds that BTT will be used for its intended purpose is tough to estimate. Multiple inquiries in their telegram channel remain unanswered.

We can make an educated guess however about their first dapp called BitTorrent Speed. In essence by paying for prioritized access to seeders, the amount of seeders should increase — because this behavior is incentivized. The problem however is that most people who torrent files do so because they don’t want to pay for a certain product. Hence, paying for access to downloading a specific file seems counter intuitive. Often the affair is also illegal in certain countries. Popular providers like ThePiratebay have been prosecuted repeatedly in the past.

3. Which improvements did the product or solution bring?

LTO: trustless and secure audit trails, a reduction of costs on paperwork and administration. Automated supply chain processes, third-party data handling etc. LTO also improved the utility of a cryptocurrency token by succesfully integrating and combining their token, product,solution users and token holder community.

BTT: As there is no working product, no improvements have been made so far. The premise is that when torrenting files there is often a lack of incentive to keep “seeding” (the process of uploading bytes of a certain file). In order to incentivize this process BTT enables payment with their token to gain prioritized access to seeders. One would thus agree to pay for downloads made for torrenting. This would in theory make it more attractive to keep seeding files, provided that people pay for it.

4. Did the solution bring new revenue?

LTO: LTO’s decentralized workflows already made it possible to cut back on costs and decision processes significantly and has real societal impact. For example, the Dutch ministry of Justice leverages LTO by digitizing part of the Dutch criminal code for petty crimes through LTO’s Live Contracts solution. The solution significantly cuts back time spent on these cases by judges, district attorneys and police officers alike.

BTT: As there is no working product, none so far.

Speculation versus Product usage — which is more important?

The previous paragraphs are not meant as a promotion for either project. In fact, a comparison would be foolish due to the vastly different fundamentals. Each project has a very different usecase and draws in a very different type of investor. The only thing the two have in common is the success of their launch. What is especially impressive is the fact that the token of BitTorrent has a daily volume of $71 million! And yet none use the token yet and it is also unclear how this token will be used in practice in conjunction with BitTorrent the app.

BitTorrent the app meanwhile draws in 100 million users and is about two decades old. The question is if these will use the token or not. On the other hands we have LTO, which started as a registered tech startup back in 2014 and is thus way younger. However, their product is already finished and integrated with their token. Actual clients are now using it.

Apparently today’s market has room for two types of investors, those who value speculation and those that value product usage. One a higher investment risk than the other.

Conclusion

And so we conclude this article and we need to ask ourselves, which type of projects do we want to see more of? Which type of project should be incentivized? Should startups be able to draw in millions of dollars based on an idea alone or should startups only be able to obtain such a large amount of money if they have a proven solution?

While developers have impact in today’s market, we should remind ourselves that so do we. Because at the end of the day it is your money which goes towards the development of these projects. Our actions have tangible consequences for the cryptocurrency market.

So which of the above projects would you support? Should startups be able to flourish on speculation alone or should the gospel of BUIDL be spread further?

Your call.