The NeuCoin Project today announced its new digital currency that aims to achieve mainstream adoption by being free to try, easy to use, and by enabling micropayments that are not viable with traditional currencies.
NeuCoin also announced that it has closed $2.25 million of initial funding. Strategic angels -- invited to invest based on their ability to help drive adoption -- include Patrik Stymne, co-founder of King (Candy Crush Saga), Rob Goldman, head of growth at Facebook, Emil Michael, SVP of business at Uber, Henrik Kjellberg, president of Hotwire, as well as dozens of other top tech and media founders and executives. Strategic advisors include Alex Norstrom, VP of growth for Spotify; Jackson Palmer, creator of Dogecoin; and Brock Pierce, serial entrepreneur and Bitcoin Foundation board member.
Using an innovative proof-of-stake (PoS) design and economic model, NeuCoin is the first digital currency that will be strategically distributed to all participants who help increase its utility, growth and value:
- Some given for free to get consumers started and more awarded for recruiting new users
- Some given to companies that make NeuCoin more useful for consumers, such as content providers that accept micropayments in NeuCoin, exchanges, processors, etc.
- Some sold to investors, with proceeds used to fund user acquisition and utility development, with a focus on micropayments
"Strategic currency distribution is a huge advantage over Bitcoin and other Proof-of-Work coins," said Dan Kaufman, one of NeuCoin's co-founders. "Instead of handing all the currency to miners, where its value is essentially spent on computing and electricity costs, NeuCoin channels the value of the currency into user growth and projects that make the currency useful for regular consumers."
"The main reason that Bitcoin and other digital currencies haven't been widely adopted is that they don't provide benefits over traditional currencies that mainstream consumers care about," continued Kaufman. "Many believe that new business models and behaviors based on micropayments (transactions from $.01 to $1.00) where traditional paymcropayments (transactions from $.01 to $1.00) where traditional payment methods just aren't viable might be digital currency's killer app. Armed with freemium distribution, this is NeuCoin's focus."
NeuCoin will roll out pilot micropayment platforms with three major content partners: MondoMedia, YouTube's No. 1 animation channel with over 2 billion views; Jango, an online music service with eight million monthly users; and RadioAirplay, an artist promotion company with 250,000 artists as customers. Consumers will be able to tip emerging musicians $0.25, pay $0.10 to watch a premium video, or pay $0.50 to avoid video ads for a month. With freemium distribution, consumers receive free NeuCoins to complete their first micro-transactions, so they can experience the service with the least friction possible. This is a huge advantage over micropayments using other digital currencies, which typically require the initial purchase of tokens with fiat money through bank accounts or exchanges -- too much of a hassle to give a $0.25 tip.
NeuCoin's utility, growth and core development projects will be funded by three separate non-profit foundations based in the Isle of Man. The foundations are controlled by coin holders and share the same mission -- to increase the value of NeuCoin. This structure allows NeuCoin to grow its ecosystem yet become increasingly decentralized over time as the currency becomes widely distributed.
NeuCoin's design maximizes security, minimizes transaction fees, and ensures its long-term decentralization. Three billion NeuCoins will be pre-mined and allocated to the foundations (83.3 percent), the founding team (6.7 percent), and the initial investors (10 percent). Over 10 years, the supply of NeuCoins will grow to approximately 100 billion, primarily from PoS awards that steadily decline from 100 percent to 6 percent per year. After 10 years, the supply of coins will grow by 2 percent to 4 percent per year, based on the number of coins staked by miners. These high PoS rates reward early NeuCoin adopters and address a critical security issue of previous PoS coins by incentivizing PoS miners to stake many coins and operate many nodes. A technical whitepaper on NeuCoin's PoS design will be published prior to the currency's launch.
NeuCoin's founders Kaufman, Johan Sandstrom, Ophélie Pubellier and Scott Walker have previously founded several successful Internet companies in the music, gaming and shopping sectors, with hundreds of millions of users in total. These include Dash, Direct Revenue, New Motion, Spray Network and Jango.
NeuCoin, along with an easy-to-use online wallet, a gamified consumer onboarding website and seamless consumer cloud mining services, are all expected to launch in the spring of 2015. Prior to launch, NeuCoin will pre-sell 100 million NeuCoins to the crypto community, with all proceeds distributed among NeuCoin's foundations.