ICOs and Cargo Cult Law

When Americans entered the East Pacific shortly after World War II, some inhabitants of  the islands created mock airways and planes made of bamboo. The thought process was if they built these structures, cargo and aid would be dropped from the people in the sky. This became known as the cargo cult of the East Pacific. Later in the century, Richard Feynman coined the term ‘cargo cult science’ in referring to a scientific concept which makes total logical sense, but is lacking the true meaning of the problem. As more ICOs come to the market, the harder it becomes to determine which belong in the category of ‘cargo cults law’. However, two ICOs with unique value propositions are WaBi and Simple Token. These new projects show interesting potential. Nevertheless, most ICOs are still at extremely infantile stages of their development.

Simple Token is a protocol used to support token economies in mainstream consumer applications. Simple Token wants to facilitate blockchain adoption within centralized businesses. This will allow for token economies to exist within the businesses’ application. Above all, Simple Token attempts to help businesses enter into ICO territory. The greatest benefit of Simple Token is the market. As one can imagine, the potential for mass business adoption could have a prominent impact on the way business ledgers function. Although this technology will be adopted in other forms aside from Simple Token, the implementation will take a significantly long time to happen. By 2025, a blockchain data ledger will be universally adopted by the businesses who need it. Currently, it is extremely difficult to convince a business to adopt beta phase technology, when their current systems have been functioning efficiently for years. In addition to the longevity of predicted adoption, one of the main problems regarding Simple Token is it has a sufficient amount of competition. Lisk and Commerce will most likely challenge Simple Token. Nevertheless, this project has the potential to provide a useful and large scale service to businesses. Ultimately, whether Simple Token is successfully adopted or not, the story of potential behind the project has the ability to emotionally motivate amateurs to invest despite how infantile the project is. The utility of the project makes it worth monitoring.

WaBi is another project which has interesting potential. This ICO is primarily based in China and its purpose is to put an end to Chinese counterfeit goods by using RFID labels through blockchain technology. The WaBi white paper does an exceptional job outlining key worldly problems which their technology will solve. Currently, there are $461 billion USD of imported counterfeit goods in circulation globally. China and other countries have a need for consistent regulation authenticity. Food safety scandals in China and counterfeit pharmaceuticals play a major role around the world. Currently, the blockchain is unable to solve the problem without a link between digital and physical assets. WaBi’s solution is linking digital and physical assets through RFID labels with anti-copy functionality. From this, consumers can authenticate products through their phones. WaBi’s purpose is humanitarian and innovative.

After the Bitcoin correction, the cryptocurrency market has realized that coins need to grow organically. Many coins and ICOs are driven up simply because of hype that exists within the marketplace. When analyzing an ICO such as WaBi or Simple Token, it is concerning when the number of downloads is not necessarily correlated with the price. Unless you are betting on the emotions of others, this is a red flag which may qualify as ‘cargo cult law’. In time, the purpose of these technologies will be implemented. Regardless of if Simple Token or WaBi execute their purposes successfully, eventually someone else will.

          Disclaimer: I am not a financial advisor. This is not financial advice. Please do your research independently and make objective decisions. This article is intended to educate readers on the risks of ICO investing while examining two ICO projects. I am not invested in WaBi or Simple Token.