Counterparty allows you to attract investors from anywhere in the world, allocate equity, and distribute profits from your company to them automatically. Additionally, the built-in asset exchange means that your tokens become part of a global marketplace with other companies and projects. Because Counterparty uses Bitcoin it’s easy to raise funds, pay vendors and staff, and get business done with the worlds most popular digital currency.
In the Counterparty protocol traditional financial instruments are implemented as self-executing smart contracts, thereby eliminating all counterparty risk and the need for an intermediary party. You can engage in asset exchange, binary options, or contracts for difference directly with other network participants trust-free and immediately.
An example of crowdfunding utilizing Counterparty
Crowdsales are a popular way to raise funds for startups, intiatives, or personal projects. They function in a similar way to Kickstarter in allowing a group of individuals to collectively fund a project or venture.
Storj is a blockchain-based decentralized cloud storage system enabling anyone to sell their unused hard drive space to a peer-to-peer network, but also to use that encrypted network to safely store files. While Storj is raising traditional investment funds, they also wanted to do a crowdsale for a very specific reason: to give developers early access to the software using a token while financing development.
After putting the idea to a vote, the Storj community overwhelmingly chose Counterparty as the platform of choice for this new method of fundraising and access control. By working together with Vennd (who made the crowdsale easy and painless) Storj was able to raise 950 bitcoin, promote themselves beyond their core community, and automate the token distribution to participants.
Counterparty builds directly on top of the Bitcoin network, and every Counterparty transaction is a Bitcoin transaction as well. This means that Counterparty transactions are just as secure as Bitcoin transactions.
Because of this, Counterparty transactions must pay a small BTC fee to the Bitcoin miners for each transaction sent. Beyond being a sign of our commitment to the health of the Bitcoin network, this allows Counterparty transactions to be given a high priority and be confirmed quickly.
If speed of confirmation is not as important to you as the fee amount paid, note that it is possible to have lower fees in Counterparty, especially involving bulk sends. This functionality will also be coming to Counterwallet as well.