Decentralized Autonomous Initial Coin Offering, is the innovative next generation model for Startup fundraising suggested by Vitalik Buterin, the Ethereum Co-Founder.
Once the Token sale is complete developers have access to all of the contributed funds. Developers are not accountable to Token holders.
After the token sale has ended developers typically have tens of millions of dollars upfront, this creates a lack of incentive and motivation to complete the project.
Blockchains and cryptocurrencies have thrived under the notion of decentralization, typical ICOs go against this ethos.
Token holders remain in control of the contributed funds, if the developers do not adhere to the stated road map token holders can initiate a refund. Token holders are protected from scams.
The team is incentivized to stay motivated and complete the project on schedule, being rewarded by the release of funds over time.
Raised funds are stored in a smart contract, with decentralized ownership. The conditions are hard coded into the smart contract, providing long term transparency and security.