Student debt strangles millennials unlike any debt crisis suffered by any other generation. Never before has a credential on a piece of paper meant so much to an individuals job prospects while the cost relentlessly escalates making that route to gainful employment less feasible by the year.
But what if their was a different route?
ICO’s have dominated the headlines of the last 12 months — and rightfully so. They have emerged as a viable alternative to funding companies, ideas and enterprises while enabling the stakeholders to maintain a larger equity position by not having to relinquish control or ownership.
The ICO model could revolutionise another industry
Imagine the opportunity to progress through a degree without accruing masses of debt, which acts as a mill stone round your neck, suffocating you following graduation. Instead of being able to enjoy your graduation to the real world, the consequences of your decision in the form of debt cloud your path forward. Immediately you are accosted by the demands of creditors who see your emergence into the labour market as an invitation to receive return on investment.
Not only do we pay the price of the degree we have been forced to acquire in order to compete, we must also pay for the interest accrued during the time we were studying. Compound interest means that whatever we value we have consumed, we end up paying significantly more back for the pleasure of having been in debt for the pleasure of studying.
But the ICO could change this
More accurately a market which enables you to ICO yourself could emerge as a viable alternative to incurring loan debts. This could be appealing to those offering the opportunity to purchase as well as those looking to fund these ventures.
This could work like the below
You list what you are intending to do at university, where you want to study, the courses you want to do and your future plans following graduation. From their private investors could ‘invest’ in you through the purchase of tokens.
These tokens would be redeemable against your future earning for a set number of years. This enables individuals to avoid the crippling stress and worry that comes with incurring such massive volumes of debt, while it allows speculators the opportunity to profit from their support.
This would work in a capped fashion where the maximum number of years following graduation would be 10. This means that there is a clear expiry for when your statue of liability expires.
The benefit to this model is that is could be entirely annoymised between the participating parties as well. Obviously enough information would need to be shared in order for an investment to seem compelling, but no personal information would ever need to be exchanged.
The application for this are almost limitless
Whether you are a student, an artist or a proffesional sportsman, an ICO could emerge as a hedge for your future earnings, where you are able to achieve some liquidity from the perception opf what your earning will be years from now.
This model seems particularly appealing for singers, where one hit single can lead to you becoming a one hit wonder or a multi-platinum star. The ICO has the potential to significantly lower your financial risk. If you turn into a massive start, you have obviously sacrificed a portion of your future earning. But if you don’t you have potentially proffited from your potential which was never realised.
What’s fascinating about this concept is the ubiquitous nature of its applicability. Annonymity can be used dependent on the situation, revealed when it is beneficial to the individual raising funds.
Not only do I think this is inevitable, I believe it is critical
It’s easy to speculate the potential for individuals to sacrifice masses of future earnings and immediately regret it, but that underestimates to lack of liquidity that students, aspiring artists or potential professional athletes lack. They have very little access to capital which means they have to make certain choices which can detrimentally effect them in the future.
Instead of viewing it as a mechanism to exploit them by selling their future at a below market rate, it must be seen for what it is.
An opportunity to realise future liqudity earlier. This allows them to be insulated against potential pitfalls that may arise and derail there progress.
ICO’s have change the way that businesses are funded
The next step is altering the way individuals can access their future earnings
An ICO offers a portal to finances without incurring the interest that incrues on top of debt.