Zilliqa ICO Review and ZIL Token Analysis
Zilliqa ICO Overview
With the rapid rise of blockchain technology, the most pertinent issue facing wider use application is arguably scalability. Recent events like the birth of Crypto Kitties, while certainly amusing, demonstrate just how vulnerable widely used blockchain protocols like ETH are when it comes to issues of scale. To expand the technology, the ability to handle a larger number of transactions per second stands as a primary roadblock. If blockchain is to ever find a use case with high transaction utilities like payment processing (think how many credit card transactions happen a second), the issue of scaling must be addressed. The Zilliqa ICO offers a novel way to address the issue of scaling.
Zilliqa ICO Value Proposition
The Zilliqa ICO introduces a new blockchain platform capable of processing thousands of transactions per second, with the potential to rival the transaction time of centralized payment transaction systems. To scale the protocol to this level, Zilliqa employs a mechanism called “sharding”, whereby transaction throughput increases linearly with network size . If we take an example of 1,000 nodes based on the protocol, Zilliqa would automatically divide the network into 10 shards with 100 nodes each. The shards can then process transactions in parallel with each other. If each shard is capable of processing 10 transactions per second, then all shards together can process 100 transactions per second.
Zilliqa will be powered by Zillings (ZILs), which are in many ways analogous to ETH on the Ethereum protocol. ZILs are used to pay fees to the network nodes. The token will initially be distributed as an ERC-20 token until the mainnet launch, when the ERC-20 will be swapped with ZIL protocol token. Within the ZIL ecosystem, each block rewards several miners at a time. In addition, the protocol is designed so that miner income is more stable compared to other chains. Low levels of variance within the ecosystem and nodes that allow mining by multiple miners at once mean rewards are distributed more evenly than other blockchains.
Zilliqa ICO Team
Xinshu Dong, CEO of Zilliqa, has previous experience in blockchain research and development with Anquan, a proprietary scalable and secure blockchain. Anquan is primarily deployed for financial and ecommerce applications and is in many ways a precursor to the Zilliqa project. As Lead Engineer of Anquan, he brings both his blockchain knowledge and leadership experience to the Zilliqa team.
Christel Quek (CMO), is an all-star member of the Zilliqa team. Co-Founder of BOLT, a live TV and gaming service (over 3M users in Kenya, Southeast Asia and Latin America), Christel also led Brandwatch‘s first office in the Asia-Pacific and served as former Head of Content at Twitter for their International Markets. Christel’s impressive track record as a business leader in the tech industry is a strong point for this project.
Other core members of the team include Prateek Saxena (CSA), research professor of computer science at National University of Singapore, whose focus is blockchain and computer security. Yaoqi Jia (Blockchain Architect), another NUS scholar and Juzar Motiwalla (Strategist), a venture capitalist responsible for investments in Asia and Silicon Valley, sure up the tech development and business ends of the Zilliqa ICO even further.
Advisor Stuart Prior is a Fintech veteran with 20+ years experience in investment banking. He currently works on corporate banking initiatives for the adoption of blockchain technology. With Zilliqa’s plan to take on the payments market, having Stuart Prior on board will certainly be to their advantage.
Zilliqa ICO Strengths and Opportunities
Partnerships are crucial to the successful launch and scaling of any project. The Zilliqa ICO recently announced a partnership with Mindshare, a huge player in the global advertising industry. The partnership is a significant milestone for the project as a way to test and develop Zilliqa’s blockchain protocol for data privacy, industry tokenization and ad fraud. Other use cases for the project that will be tested include appropriate ad placement and data insight for advertisers. Targeted applications like the partnership with Mindshare, where high-throughput blockchain is an advantage, lend significant credence to the prospect of success for the Zilliqa ICO.
Zilliqa’s incetive for miners is another strong suite of the project. Miners can count on the stability and low variance of the Zilliqa protocol, which theoretically provides a competitive advantage to mining ZIL over other tokens. To provide an example- as the number of transactions exceeds 200x or more per second, transaction fee competition actually becomes less intense. Simultaneously, processing fees for the miners themselves will also be reduced. Less competition, more stability and reduced mining costs are all significant advantages of mining ZIL and will only serve to further increase the scalability of the protocol.
Zilliqa ICO Weaknesses and Threats
It’s important to note while the argument could be made Zilliqa will be in competition with the likes of ETH and NEO, the team claim they are not looking to displace these protocols per se. Instead, they are targeting markets where high-throughput use cases are particularly relevant, such as payment transactions and advertising. This aspect gives Zilliqa a first mover advantage in the high-throughput space, though other scaling solutions could indeed create competition as they are implemented. With projects like Raiden and Plasma in the pipeline, the Ethereum protocol will have the means to address scaling issues that posed a stumbling block. To better hone their competitive advantage, the Zilliqa team plans to target niche use applications and gain a solid hold in the crypto space as a result.
At this stage, Zilliqa’s public testnet is yet to be released. However, in an interview with CEO Xinshu Dong, we were told that the testnet will be made available by January along with deployment of some host nodes. As the project is open source, it will be verifiable by independent parties. Deployment of the testnet will be an important step in solidifying the Zilliqa protocol’s status as a proper blockchain scaling solution.
The Verdict on the Zilliqa ICO
According to our analysis, the Zilliqa ICO scores superbly across the board. All the ingredients for an outstanding ICO and project are there- an all-star team, big time partnership, first mover status with a killer concept and community support to back it all up. We are excited to see what is in store for Zilliqa in 2018 and will be making a big bet on this one.
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Today’s Date: 12/26/17
Project Name: Zilliqa
Token Symbol: ZIL
White Paper: https://docs.zilliqa.com/whitepaper.pdf
Position Paper: https://docs.zilliqa.com/positionpaper.pdf
Crowdsale Hard Cap: $22 million
Total Supply: 21 billion
Token Distribution: 30% to crowdsale contributors, 40% to miners, 30% to project for research and development, bounty programs, team allocation
Price per Token: 116,060 ZIL per 1 ETH
Maximum Market Cap (at crowdsale price): US$73 million
Bonus Structure: 10-15% presale bonus for early contributors
Presale Terms: N/A
Important Dates: Community Contribution (ICO) December 27th, 2017 – January 10th, 2018
Expected Token Release: 2 weeks after Community Contribution is complete
ICO Review Disclaimer
The team at Crypto Briefing analyzes an initial coin offering (ICO) against ten criteria, as shown above. These criteria are not, however, weighted evenly – our proprietary rating system attributes different degrees of importance to each of the criteria, based on our experience of how directly they can lead to the success of the ICO in question, and its investors.
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This category accounts for the leaders, developers, and advisors.
Poor quality, weak, or inexperienced leadership can doom a project from the outset. Advisors who serve only to pad their own resumes and who have ill-defined roles can be concerning. But great leadership, with relevant industry experience and contacts, can make the difference between a successful and profitable ICO, and a flub.
If you don’t have a team willing and able to build the thing, it won’t matter who is at the helm. Good talent is hard to find. Developer profiles should be scrutinized to ensure that they have a proven history of working in a field where they should be able to succeed.
What is the technology behind this ICO, what product are they creating, and is it new, innovative, different – and needed?
The IOTA project is a spectacular example of engineers run amok. The technology described or in use must be maintainable, achievable, and realistic, otherwise the risk of it never coming into existence is incredibly high.
Tokens which have no actual use case are probably the worst off, although speculation can still make them have some form of value.
The best tokens we review are the ones that have a forced use case – you must have this token to play in some game that you will probably desire to play in. The very best utility tokens are the ones which put the token holder in the position of supplying tokens to businesses who would be able to effectively make use of the platforms in question.
There doesn’t have to be a market in order for an ICO to score well in this category – but if it intends to create one, the argument has to be extremely compelling.
If there is an existing market, questions here involve whether it is ripe for disruption, whether the technology enables something better, cheaper, or faster (for example) than existing solutions, and whether the market is historically amenable to new ideas.
Most ideas have several implementations. If there are others in the same field, the analyst needs to ensure that the others don’t have obvious advantages over the company in question.
Moreover, this is the place where the analyst should identify any potential weaknesses in the company’s position moving forward. For instance, a fundamental weakness in the STORJ system is that the token is not required for purchasing storage.
With many ICO ideas, the timing may be too late or too early. It’s important for the analyst to consider how much demand there is for the product in question. While the IPO boom funded a lot of great ideas that eventually did come to fruition, a good analyst would recognize when an idea is too early, too late, or just right.
Progress To Date
Some of the least compelling ICO propositions are those that claim their founders will achieve some far-off goal, sometime in the future, just so long as they have your cash with which to do it.
More interesting (usually) is the ICO that seeks to further some progress along the path to success, and which has a clearly-identified roadmap with achievable and reasonable milestones along the way. Founders who are already partially-invested in their products are generally more invested in their futures.
Community Support & Hype
Having a strong community is one of the fundamental building blocks of any strong blockchain project. It is important that the project demonstrates early on that it is able to generate and build a strong and empowered support base.
The ICO marketplace is becoming more crowded and more competitive. While in the past it was enough to merely announce an offering, today’s successful ICO’s work hard to build awareness and excitement around their offering.
Price & Token Distribution
One of the biggest factors weighing any analysis is price. The lower the price the more there is to gain. But too low of a price may result in an under capitalized project. It is therefore important to evaluate price relative to the individual project, its maturity and the market it is going after.
The total supply of tokens should also be justified by the needs of the project. Issuing a billion tokens for no reason will do nobody any good.
Communication is key. The success of a project is strongly tied to the project leaders’ ability to communicate their goals and achievements.
Things don’t always go as planned but addressing issues and keeping the community and investors in the loop can make or break a project.