Swarm Fund is the blockchain for private equity. It’s a fully decentralized capital market place that democratizes investing by using the power of the blockchain to open up high-return, alternative investment classes to smaller investors through asset-backed funds using cryptocurrency tokens. It makes traditionally exclusive investment opportunities, such as private equity and hedge funds, inclusive for the Swarm by pooling together smaller investments into larger, institutional-sized blocks.
Swarm Fund also gives fund managers access to more capital from a new asset class of investors who want access to institutional-type investments, but don’t have the high minimums many institutional funds require. Pilot investment vehicles on the Swarm Fund platform include a Distressed Real Estate Fund, a Solar Energy Fund, and a Crypto Hedge Fund.
Machine Learning and applied statistical models have already had success on Wall Street. We can apply similar methods in the crypto space to the same end. In the crypto space, we foresee a substrate where models can learn from market trades made by real humans. Such models can then be selected in the form of genetic models that are chosen based on performance. New models can evolve from existing selective pressures in the marketplace that are the most efficient and effective for achieving the desired goals.
“Swarm Intelligence” is a scientific field that arose from the study of self-organizing biological systems. Many species make heavy usage of multi-track systems to incentivize socially positive behavior. This allows complex life to develop and evolve in a dynamic fashion. In many ways, this is similar to the mathematics behind fractals. This formalization of rules happens at the level of harmonic principles, rather than at the specific structural level, as often happens with hierarchical organizations.
Swarm Fund applies this concept (formally known as “stigmergy”) to finance through blockchain technology. In particular, reputation plays a key role as different system behavior is tracked and positive behavior is incentivized. Consequently, the greater the trust and transparency and effectiveness of the underlying system, the less formal command and control methods are needed and the more finance can be fully automated.
Our MVP is a stake-weighted liquid democracy organization deployed via Solidity smart contracts. It allows for putting forward proposals and dynamic allocation of capital to causes or sub-projects. Additionally, stake can be bought. The smart contracts are open source and can be viewed on our github.
Swarm uses a stake-weighted liquid democracy system for governance, in which stake is gradually sold off to interested parties. This implementation is described in detail in the Whitepaper.
Swarm Fund sold nearly 8.2 million tokens, an equivalent of $5.5 million, during the Presale and Token Sale combined.
The foundation’s operational and product development expenses are budgeted as follows:
The Swarm Core Team is a diverse set of professionals who bring deep experience from the finance, technology, and blockchain worlds. Our Swarm partners have engineering backgrounds, and include an investor and Board Member of the BankerBay deal origination platform & VC (Timo), and a former technology startup founder & CEO with private equity experience from Deutsche Bank and Allianz (Philipp). Other team members bring experience from Microsoft, Facebook, UBS, and several technology and community focused startups. Our advisors include Ethereum Co-founder and Jaxx Founder Anthony Di’Iorio and Sequoia Heritage Fund Co-founder Mark Oei.
No. Swarm is a platform which also enables the management of funds. Our platform connects investors with fund syndicates offering opportunities to invest crypto assets into real world assets across multiple different asset classes.
Incorporating machine learning, Swarm’s AI engine automates and simplifies difficult investment decisions.
Yes, and more. One of the use cases of the Swarm platform is for individual assets to raise capital. Swarm has the capacity to act as a traditional fundraising platform. At the same time, this is only one aspect of the ecosystem we are building, which also consists of a core investment engine powered by a myriad of Swarm-built plug-in services, each of which adds greater functionality to the overall auto-investing capability.
At the initial deployment of the platform in 2018, the Swarm team vets the opportunities with a mind for diversity across verticals and geographies.
Later on, this will open up to anyone offering due-diligence proof-of-work. The Swarm community will decide on the presence of hosted opportunities via the application of the Liquid Democracy Voting Module (LDVM).
The machine learning technology will develop in parallel, as a result of platform use. Initially, machine learning can offer predictions while humans make the final decision. Think of it as the 11th person in the boardroom.
We open doors for fund managers to receive capital from a whole new class of investors, that may have previously been limited by minimums, exclusivity, and regulations – such as the cryptocurrency and retail classes.
It’s empowering for fund managers to be free from a brand organization but have the same access to cutting-edge deal flow, data and manageability.
This streamlined method of raising capital appeals to investors as well, providing a uniquely efficient experience and direct access to liquid assets.
1. The SWM token is the gas that powers our platform. The outermost layer.
2. The SUN (Swarm Utility Network) token is a dollar-pegged token that symbolizes capital in the SUN Ecosystem.
3. The SRC20 Token is a token within the SUN Ecosystem that is individually named and assigned to a hosted fund. For example, our Distressed Real Estate fund has an SRC20 token called (DRE), which mimics the flow of capital within that project.
This ownership, governance and 3-tiered token structure are designed so that Swarm Fund can pass several aspects of the Howey Test, the applicable legal benchmark for security regulation in the U.S., while operating within the guidelines issued by the SEC on July 25, 2017 for ICO compliance.