In this post, I’ll share my personal views on ICON’s business strategy and philosophy and how they affect the project’s public perception and expectations. Please note this is not investment or financial advice.
From the perspective of mainstream consumers and retail investors, blockchain and cryptocurrency projects generally fall into two classes of interactivity – direct and indirect. As an investor in such a new speculative market, it’s important to understand the distinction between these classes and its effect on business and marketing strategy.
Projects that fall under “direct interaction” include Bitcoin, Litecoin, Monero, Substratum, and Basic Attention Token. The goal of these projects is to create a network effect and create value through direct adoption from the mainstream public. Bitcoin’s value will increase if more people directly use the network to transact with each other. Similarly, the value of Substratum will increase if more people use their consumer-oriented software to browse a censorship-free web and host their websites.
In today’s mainstream tech world, two companies that rely on direct interaction to build value are Facebook and Twitter. These two companies require direct interaction from consumers to satisfy their business model. If no one used Facebook, it would be worthless. Same goes for Twitter.
Projects that fall under “indirect interaction” include ICON, Ethereum, and Ripple. The goal of these projects is to create a backbone protocol for other businesses and entities to build on top of and connect to. While these projects may include occasional traces of direct interaction, their main focus is on creating a network effect through strategic partnerships with institutions who are interested in using their protocols. For these projects, success may not necessarily equate to mainstream recognition. Instead, success may come in the form of dependent invisibility, where consumers don’t realize the everyday online services they use are dependent on these blockchain networks.
In today’s world, we use HTTPS, SMTP, and DNS on a daily basis. HTTPS is a protocol for secure communication over the Internet. SMTP is a protocol for email transmission. DNS is a protocol for linking domain names with web server IP addresses. Most people go about their day to day lives without realizing these protocols even exist, and yet they have immense value to society. Services like Amazon AWS web hosting, pretty-looking URL shorteners, and our beloved Gmail are the things we use to interact with these protocols on a day to day basis.
Here are a few quotes from ICON’s whitepaper.
The ICON Project began with the goal to enrich our everyday lives through “connection”.
The ICON Project is not simply a connection of blockchain nodes, but a deep study or an investigation of community-to-community connectivity. ICON started with the mission to create a protocol, or cryptocurrency, to be actively utilized in the real world within and between actual communities.
The ICON Project aims to build a decentralized network that allows independent blockchains with different governances to transact with one another without intermediaries. Anyone can create a new blockchain project and join the network. A new blockchain project is free to connect with existing projects and create new unique worlds, or blockchain multiverse. ICON itself can be viewed as both a living organism and an ecosystem.
From these quotes, we can safely conclude that ICON’s goal is to build a protocol that enables exotic communities to communicate with each other in order to build novel services and ecosystems that were previously not possible. After realizing this, it’s easy to understand why ICON’s marketing focus has been primarily of the B2B variety.
A common complaint I often see in the ICON subreddit and Telegram channel has to do with ICON’s lack of consumer and retail-oriented marketing. I believe there are several reasons for these complaints, with most of them being somewhat unreasonable.
Before discussing the first two points, I would like to say I completely understand the negativity towards ICON’s lack of B2C marketing, and I do agree there is major room for improvement – more on this later on.
Token holder versus shareholder – there’s a major difference. In this stage of the game, investing in a cryptocurrency is complete speculation – it can be educated speculation, but it’s still speculation. We do not have the same rights and protections as a shareholder, and we should act accordingly. In the world of corporate business, there are usually quarterly shareholder meetings that act as a medium of communication between shareholders and company executives. As token holders, this does not apply to us.
We should not expect constant communication from executives – the fact that we even have some communication from ICON’s executives is completely unheard of. Imagine Mark Zuckerberg tweeting (LOL) with a Facebook user about Facebook’s upcoming plans on a consistent basis. The truth is, blockchain and its decentralized identity have already punctured a gigantic hole through the facade of normal corporate communication, and the fact that Min Kim willingly spends his free time interacting with the ICON community members is absolutely incredible.
This is further compounded by the fact that, unlike many blockchain projects, ICON has real ties with many industry-leading companies, major banks, top universities, and government institutions. Here are examples of a few – LINE, Deloitte, Samsung, SBI Ripple Asia, DAYLI Intelligence, Smilegate, and more. Many of these companies are worth billions of dollars and have assets and brand recognition of their own to protect. You have to understand that creating coordinated PR strategies with these huge corporations and government entities takes time and patience. Most importantly, it’s not the kind of stuff ICON can whimsically tweet about whenever they feel like it. Obviously, ICON wants to share all the great things happening behind the scenes, but legally they cannot do this without being sued by their partners. Do you think LINE would be okay with ICON publicly talking about future blockchain DApps on the LINE platform? No, because this would affect LINE’s bottom line if its competitors can race to build a similar product.
Let’s talk about price. The value of direct interaction currencies like Bitcoin and Monero appreciates when more people use them to transact on a daily basis. For an indirect interaction network utility token like ICX, value increases when the token is utilized on the network. Please take a moment to understand this. Yes, ICX can act as a digital cash as well, but this is not its primary purpose. How do we know this? Because it’s not fungible like Monero and CoinJoined Bitcoin.
So what is ICX used for?
Okay, so all three examples above have one thing in common – ICX gains value as a network utility token. I cannot stress this enough. ICX will not have real value if a bunch of retail investors buys it. ICX may gain “bubble value” if a bunch of hedge funds buys it. ICX will only gain REAL value if the ICON platform is used to connect people, businesses, and institutions together to create new and unique connections that can be monetized.
Knowing this, I hope you have a better understanding of why ICON is working to onboard businesses to build on and connect to the ICON platform first. At this stage of the game, there’s very little incentive to market to retail investors because we are not the intended users of the ICON network. We are the intended users of the services that will use ICON as a backbone and interoperable protocol. Thus, ICON is choosing to devote 95% of their manpower to the core business philosophy, and as true supporters of the project, we shouldn’t have it any other way.
A few weeks ago, I met with a member of the Deblock team in Seoul. While no specifics were discussed, I was told that ICON is aware of the void when it comes to marketing to retail investors, and they are working to improve their communication with the community. In the meantime, perhaps the community can also come together to promote ICON to other retail investors. Here are a few suggestions.
At the end of the day, understand this. If you’re invested in ICON expecting constant updates even when there is no publicly disclosable news, you can either change your mind and open your eyes to what ICON is trying to achieve, or you can simply continue feeling more and more negative every single day. Remember, you’re not investing in the next Facebook. You’re investing in the protocol that made Facebook possible in the first place.
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