ICO Status: In-progress
Taken directly from their whitepaper, CommerceBlock is ‘a public blockchain infrastructure company that is architecting a platform that allows anyone to build and use financial products and services historically reserved for commercial banking customers. The CommerceBlock network will be the first technology platform that provides a combination of trust minimal trade, decentralised contract execution, on-chain derivatives, and asset-backed token issuance to public blockchains.’
Did you understand that? No, neither did I. And that’s the problem with many cyptocurrency ICOs at the moment: they’re highly technical projects often started by highly technical people who fail to communicate the proposition in a meaningful way to people who are less technical, but want to invest in cryptocurrency startups.
From what I can understand though, CommerceBlock combines the real world contract details needed between buyers and sellers (I’ll buy this off you according to these terms) with the immutable transparency of a public blockchain while still preserving the privacy of the contract details themselves.
CommerceBlock plans to release a range of products that enable anyone to build and use services that construct contracts, manage trade flows, engage in multiparty dispute management, and issue assets. Rather than store the details of these contracts publically on the blockchain, CommerceBlock uses protocols that take each person’s blockchain address and creates a new address based on metadata that are only known to the parties involved. This way, the transaction is visible on the blockchain, but the privacy of the details are secured.
There’s no doubt that real world transactions – both in retail, and peer to peer, have a need for contract details to be visible and immutable but only between the two parties concerned. And from what I can understand about the CommerceBlock proposition, it sounds like their technology would solve for this.
But the problem is the idea is neither new, nor protected from future immitation. For example, DigitalNote already seem to have a proposition similar to CommerceBlock’s in market.
Now, I’m sure there are significant differences in the protocols being used, but again that just hits back to my earlier point: CommerceBlock have failed to communicate these points of difference in their ICO pitch. And it is a pitch; they’re wanting cryptocurrency investors like us to part with capital and speculate based on their potential – but they fail to help us see and understand that potential! Maybe it’s me; maybe I’m too dim for this!
From what I can determine in their literature, CommerceBlock seem to be targeting the Enterprise end of the market. This puts them into competition with pretty much every other blockchain platform out there, and any others who choose to take a version of the many open-source projects out there and mould into a similar offering.
In essence, CommerceBlock tokens (CBTs) will increase in value commensurate with the number of companies who incorpoate their technology and the number of developers who build stuff which generates transactions across their blockchain. Again, here’s the exercpt from their whitepaper:
“The CommerceBlock network token lays the foundation for a public blockchain based ecosystem of trading platforms and infrastructure companies. Companies that download our SDKs will be fully integrated with CBTs out of the box. By building a self sustaining ecosystem of companies that accept CBTs, an emergent network of developers will be incentivized to improve upon and help maintain the open source libraries that CommerceBlocreleases. In this respect, CBTs have a binding effect: companies that build useful infrastructure using the CBTs will increase its value, providing further incentive to improve the libraries. This tightly couples the success of ecosystem companies to the CommerceBlock network token.”
CEO Nicholas Gregory is a clever man and has been involved in computer science, blockchain and cryptocurrency for a considerable length of time. The remaineder of the team are all highly skilled from a technical perspective.
In some ways, this adds attractiveness to the opportuntiy as essentially this is a bunch of incredibly smart people building something which they genuiely believe can solve a real world problem impeding the adoption of blockchain in the mass market. It’s a pity their marketing department hasn’t yet realised the need to communicate this in a way that is easily understood by people without a computer science degree!
CommerceBlock have already completed an open-source implementation and BIP specification of the pay-to-contract protocol. Beyond that though, it seems from their literature that there is little else practically developed at this stage with the majority of the ICO proceeds being ear-marked for new hires, research, and product development. The team plan to have a working beta product available by Q2 2018.
CommerceBlock are aiming to raise a maximum of $25m USD through the ICO sale of CBT tokens. There will be a maximum of 1 billion CBTs available. At the time of writing, there are no details available which state the number of CBTs you will receive per ETH.
As a non-technical investor, I think the CommerceBlock proposition is difficult to invest in at this stage. This is mainly due to the difficult in understanding how CommerceBlock differs from existing offerings, and how it will protect itself from imitation in the future.
The model itself at a basic level is easy enough to understand – it’s a platform that faciliates contracts between parties where those contract details are private and only viewable by the parties themselves, while the record of the transaction remains immutable on the blockchain. What’s hard to see though is why I should invest in CommerceBlock ahead of all the other blockchain platforms out there.
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