INSUBCONTINENT EXCLUSIVE:
Investing in initial coin offerings, or ICOs, is a minefield
This isn''t just true for people with absolutely no technical background but also for many investors who may be well-versed in tech but
still struggle to understand many projects& white papers.
Enter TruStory, a platform for users to research and validate claims that people
make online, whether in a blog post, white paper, website or social media post
The young company aim is to &bring authenticity back into the digital and decentralized world.
It a huge and growing opportunity
Though regulators around the world are cracking down on cryptocurrency fraud, the number of ICOs has skyrocketed and the funds raised
through the mechanism are increasing
According to data collected last month by CoinDesk, ICOs raised $6.3 billion in the first three months of 2018; that 118 percent more than
projects managed to raise by way of ICOs in all of 2017.
It not just blockchain-startups that are carrying out ICOs, either
Many other types of companies are trying to use them — and many of them are frauds.Just last week, The Wall Street Journal published
ananalysis of 1,450 cryptocurrency offerings, in which the outlet found &271 with red flags that include plagiarized investor documents,
promises of guaranteed returns and missing or fake executive teams.
Separating the wheat from the chaff is a tall order, but investors are
willing to bet that TruStory can do the sorting.The outfit just raised $3 million in seed funding led by True Ventures with participation
from Pantera Capital, Kindred Ventures, Homebrew, Coinbase Ventures, Wonder Ventures, Abstract Ventures and former TechCrunch co-editor
Alexia Tsotsis through her new fund Dream Machine.
The round also attracted checks from numerous notable individual investors, including
Coinbase co-founder Fred Ehrsam, entrepreneur and investor Scott Belsky and former Twitter MA executive Jessica Verrilli, who recently
joined GV as a general partner.
All are betting on TruStory founder,Preethi Kasireddy, and it easy to imagine why, given her trajectory so
A USC grad who studied industrial and systems engineering, Kasireddy took a job as a banking analyst with Goldman Sachs after graduating,
learning how tech company financials work
After less than a year, Kasireddy was searching out a new role as an engineer but a cold call from Andreessen Horowitz led instead to a role
on its deals group, where she learned from the firm general partners, as well as developed a fascination with everything blockchain
related.
In fact, several years after Andreessen Horowitz wrote an early check to Coinbase, Kasireddy left the firm to work for the digital
currency exchange as a self-taught software engineer
There, she says, she architected and implemented the front-end interfaces and APIs required for the integration of Ethereum onto the
Coinbase brokerage platform, among other things.
Then she left, again
&I just started to teach myself how to write code that runs on Ethereum
I was contributing to different blockchain projects and just listening, and learning, and observing.& She was also taking note of the
growing number of false claims that people were making while raising millions of dollars in the process.
How TruStory will more effectively
verify the veracity of these claims isn''t something that Kasireddy is interested in discussing publicly in great detail
(&The space is rampant with people copying other people ideas.&)
What she can say is that it will use the wisdom of crowds — including
scientists and researchers whom she is currently lining up — to evaluate whether a project or person is legitimate
They won''t be doing this out of their own beneficence
When someone successfully validates a claim or else identifies aspects of an offering that doesn''t make sense, she or he will &earn tokens
and reputation and influence& for their efforts, Kasireddy explains.
If they&re dishonest, they&ll lose on all three fronts
(The tokens are generated using the protocol itself, she says.)
Eventually, says Kasireddy, the platform will be used to validate far more
&We&re starting with crypto market and claims being made in white papers and websites and building a network to help investors and
researchers who need this information to make the right decisions.& But there are &other ways to use the same incentive design to validate
other claims,& she says.
There will also be opportunities for people to buy tokens to have projects vetted, she adds, saying to ''think
about Facebook or Twitter& where there are plenty of claims of dubious origin that stakeholders might want to see either validated or
debunked.
Asked when TruStory will actively start reviewing what out there already, Kasireddy suggests the outfit isn''t ready for prime
TruStory is currently run solely by Kasireddy, who is in the process of bringing aboard a couple of operations people and a few key
But she says that unlike many other founders in today market — including those who&ve raised venture capital — she not interested in
orchestrating an ICO to supercharge her company or her hiring plans.
We&ll fund ourselves through the development of our tokens, and we
expect the tokens eventually to fund the business.
It about getting those token economics to work,& she says
&And then the engine starts up.
