The new age of ICOs is here, and it’s not based on Ethereum
ICOs are said to be the new way to raise money. We’ve seen companies raising $100 million, $156 million, $185 million and even $232 million by selling tokens that will be used in the protocol that these companies have promised to build using this money.
Against the money raised, the tokens they gave were created and sold on the Ethereum blockchain — meaning that all the trade that took place happened on the Ethereum blockchain and the tokens created are tracked on the Ethereum blockchain. But that is changing.
Ethereum’s mission of making blockchain more than a calculator has allowed them to invent the concept of smart contracts. You can think of smart contracts as a set of rules governing something, which cannot be modified ever in the future. They allow a developer to write anything in the form of a smart contract that gets executed by the network. Consider the example:
If A and B place a bet about the next day’s weather, the bet can be carried out in a trustless manner using a smart contract. Both of them can submit their betting amounts to the smart contract. At a predefined time on the next day, the contract will make an API call to the Open Weather API to see if the weather is sunny or rainy. Depending on the weather, the total amount will be sent to either of the two.