Why Was Kaizen.Finance Created: Enabling Trust and Transparency in Crypto
It all starts with an idea and Kaizen.Finance is no exception.
Lifting the veil, let’s consider the motivation that lies behind Kaizen.Finance, why it was created, whose needs it strives to meet, and what problems to resolve.
SAFT: The Flaws Behind a Paper Contract
To date, token presales are largely carried out via a Simple Agreement for Future Tokens (SAFT), a paper contract that specifies the token quantity to be sold as well as the conditions of their acquisition.
Despite the SAFT importance (which is to regulate relationships between cryptocurrency developers and investors), SAFT-based token presales have legal complexities and are subject to fraud opportunities.
That’s a problem the entire industry is exposed to.
The compliance issue is aggravated by the lack of reasonable confidence between involved parties: Investors must be ready to give their funds based on promises and trust projects to keep their commitments, and projects must put trust into their investors in hopes that they won’t sell off their tokens immediately messing with the token’s market price.
Besides that, smart contract developers frequently do not take part in the offering and have no liability for the software-based contracts they build.
These particular frictions in SAFT agreements have led to the creation of Kaizen.Finance.
Kaizen was founded to provide projects with a platform for generating and managing their tokens’ lifecycles by establishing transparent, long-term, and robust relationships with investors through the implementation of smart contract-based agreements.
Unlike SAFT, a smart contract cannot be canceled or altered once it has been deployed.
Despite the gaping issue of SAFT, there is more to the challenges that the industry is currently up against; and Kaizen is here to address.
Token Vesting: The Associated Risks and Hidden Threats
Vesting is the process of locking and unlocking tokens after a set amount of time has passed. A thought through vesting schedule is key to managing the price of the token and keeping investors happy.
When done correctly, vesting schedules help prevent mass token sell-off and control distribution of tokens among early investors in designated portions after a set period.
More importantly, vesting schedules:
- indicate the team’s long-term commitment to the project;
- protect interests of those who chose to invest before a project started trading publicly;
- assure long-term stability of a project and its token ecosystem.
On the flip side, incorrect implementation or nonadherence to vesting schedules may lead to a sudden decline of price caused by a massive sell-off either by project’s team or investors.
This is possible when a single or a small number of entities hold a significant percentage of the unlocked tokens at the time of TGE.
Due to the lack of a vesting schedule, such holders may easily cause supply swings, harming the token’s price. Such an impact can be catastrophic to other involved parties and pose a significant threat to the token’s stability.
Kaizen.Finance provides vesting schedule configuration and automation tools.
They are powered by smart contracts and require no knowledge of code to use. With Kaizen, projects can configure any amount of vesting schedule from the ground up, setting up cliff and unlock periods.
Using Kaizen for vesting schedule automation ensures all agreed terms will be met with precision, and no selling opportunities will be missed.
Kaizen Solution: Accessible Smart Contract Automation
From coming up with an idea for a project and before launching its token, significant work must be done requiring serious expertise. It’s usually a bumpy road with issues inevitably occurring along the way for all involved parties — projects and investors alike.
When creating Kaizen.Finance, we considered the issues pertaining to both parties equally.
Kaizen.Finance was developed to help projects and investors achieve desired goals without disrupting reasonable expectations of either party:
- Project-investor agreements are secured through smart contracts.
- Issuance of tokens, creation of vesting schedules, and distribution of tokens to investors is automated and secure through smart contracts to ensure adherence to agreed terms.
- All tools and services provided by the platform can be used to full extent without writing a single line of code.
The platform introduced by Kaizen.Finance will enable projects and investors to reach new levels of trust and transparency resulting in stronger and more meaningful relationships, which benefit not only involved parties but the industry as whole.
Follow Kaizen Finance:
