ICO escrow services are essential as they involve using a third party which is trusted for the facilitation of transactions for projects and their investors. Most important, they are responsible for withdrawing money once the ICO has been completed and will either transfer it or return the funds to investors.
ICO escrow services are very similar to their traditional counterparts, the difference being that they involve Initial Coin Offerings. The escrow is a deposit which is conditional involving a specific amount of funds sent through third party sources. Over the web, an ICO escrow service would work in the following manner: rather than the funds of the investor being immediately transferred to a project, they will instead be sent to a third party which is independent and which will function as a guarantor until the project is completed or fulfills its required obligations. Only afterward will the project head receive the money.
The primary benefit of ICO escrow services is that they protect investors and their funds, and hold project planners to their obligations. The funds will be gathered within a special wallet which is multi-sig, which will only be accessible to certain escrow agents. In most cases two escrow agents will be assigned to the project. The agents are responsible for verifying the ICO and confirming that the project meets the requirements that have been promised, and whether specific terms have been observed.
If each of the requirements are adhered to and the project developers fulfill all their obligations, then the startup will be granted access to the funds which are available in the wallet which is multi-sig. The funds will usually be issued in a series of stages, for various project phases or periods. For example, let’s say that an ICO project has successfully raised $1 million.
The implementation plan for the business model is to split it into ten phases. The initial $100,000 is made available to the project developers at the collection phase conclusion. Then the escrow representative will monitor the completion of subsequent stages based on established conditions, as well as adherence to deadlines. Once the developer completes the next phase, they will be issued another $100,000 by the escrow representative from the wallet, and so on and so forth until the entire project has been completed.
The ICO escrow services provided by Blockchain Developers are designed to protect those investing in Initial Coin Offerings. The ICO team will not be able to spend the funds independently without having the digital signature and authorization of the escrow agent. The agent is responsible for ensuring the integrity of the project and the funds which are allocated to it. Our ICO Escrow services are designed to create transparency and trustduring the development phase and will give investors peace of mind knowing that the capital they’ve dedicated to a project will be used in the manner for which it was intended. Contact us today to learn more.