Crowdfunding and Bitcoin are a match made in heaven. However, it is difficult to combine both of these aspects into powerful platforms in order to take the world by storm. Bitcoin-enabled crowdfunding platforms are experiencing major difficulties gaining mainstream attention, with a few exceptions here and there. The relaunch of Chroma.Fund may well change all of that, as they have revamped their business model and integrated colored coins.
Chroma.Fund Revamped – Bitcoin Options Meet Equity Crowdfunding
In its previous iteration, Chroma.Fund was a powerful investment and crowdfunding platform for people living in the state of Oregon. In fact, this platform was part of the Oregon Story Board accelerator’s first class earlier in 2015. Rather than relying on taking equity in a company, crowdfunders would buy a stake in the company or project’s future revenue.
This business model is nothing new, as Bitcoin crowdfunding platform BnkToTheFuture is looking to do the same. It is far more appealing for potential investors to receive a share of company profits, rather than have a stake in a company itself. Dividends have become synonymous with equity crowdfunding these days, and receiving a passive income from an investment is providing precisely that experience.
That being said, Chroma.Fund noticed things could be improved further, especially once the state of Oregon approved crowdfunding rules to let non-accredited investors invest in companies. During the first few weeks of the platform being live – and this ruling is not approved yet – Chroma.Fund was forced to verify their investors’ net worth. It goes without saying this scenario created a lot of awkwardness for all parties involved, which is why the team decided to revamp their entire business model.
Developing a new platform from scratch – especially so soon after launching the project just a few weeks ago – was not an easy task. But Chroma.Fund tackled things with a hands-on mentality and started working with Oregon’s state officials. The main goal was using the Oregon Intrastate Offering Exemption as a licensed portal for their crowdfunding platform.
“The Oregon Intrastate Offering Exemption was added to the Oregon Administrative Rules on Jan. 15, 2015. Oregon Story Board Demo Day was on Jan. 9th. We were as surprised as anyone. In hindsight, our timing on the development of this platform was perfect.” – Chroma.Fund CEO Marcus Estes told the media.
Using Colored Coins On Chroma.Fund 2.0
After months of development, discussions, and sleepless nights, Chroma.Fund 2.0 was recently launched. Not only are Oregon residents able to invest up to US$2,500 in companies, but the company is also working on allowing residents in other states to participate. It will probably take a few more months, if not years until the necessary legislation and regulation is drafted to allow for this business to expand beyond Oregon’s borders.
That being said, the biggest change comes in the form of ChromaCoin, a colored coin issued by Chroma.Fund to investors who want to buy a stake in a company’s future revenue. Doing so will allow both Chroma.Fund and the company in question to keep track of who invested how much into their project, and how much of the profit they are owed.
“Chroma.fund users invest with U.S. dollars, but instead of receiving a paper stock certificate, users are instead issued a ChromaCoin — a tiny fraction of a single Bitcoin, worth less than a penny. This ChromaCoin serves as a counterfeit-proof record of ownership of the stocks and bonds purchased on Chroma.fund.” Marcus Estes concluded.
Images courtesy of Chroma.Fund, Shutterstock, Slideshare