Business and FinanceExchangesNEWS

Bitfinex Has Got 1 Bln Commitments in USDT for its Token Offering: Investor

Bitfinex Has Got 1 Bln Commitments in USDT for its Token Offering: Investor 1

One of major shareholders reports that investors have already lined up to buy the LEO token, providing commitments for $1 bln in Tether

Dong Zhao, a China-based investor, the creator of DGroup, who has an equity in the controversial Bitfinex exchange, has mentioned in a recent social media post that most likely Bitfinex will not be doing a public sale for its LEO token. The details were shared by CoinDesk.

The Bitfinex-Tether case

After the recent scandal with the missing $850 mln, which belonged both to the customers and the exchange, the loss was secretly covered with USDT. Recently, Bitfinex decided to fill that tremendous financial gap through an Initial Exchange Offering (IEO).

The $850 mln belonging to Bitfinex are reportedly held by the Crypto Capital financial firm. Alas for Bitfinex investors, the funds have been held up by authorities of several countries, including the US.

Following the current trend of IEO, the exchange decided to offer customers its own token dubbed LEO to be bought with USDT.

Hard and soft commitments from corporate customers

The plan was to conduct a closed token sale first. Then, unless the exchange manages to attract $1 bln in Tether, Bitfinex would conduct a public sale as well, letting retail investors take part too.

Now, Dong Zhao says that Bitfinex has already got hard and soft commitments from investors that total $1 bln.

Those who have left commitments have already transferred USDT to buy their LEO. Investors with soft commitments can withdraw their intention and money anytime.

Zhao’s company has also prepared to buy LEO tokens and made a hard commitment. However, they have not disclosed the details about the amount to be invested.

LEO will reportedly be used on Bitfinex for internal services.

Telegram closed token sale

Another major example of a closed token sale, though that was an ICO, was conducted in spring 2018 by the Telegram messaging app.

Its Telegram founder Pavel Durov intends to create a Telegram-based platform TON (Telegram Open Network), which would perform various functions, including those of a global social media with P2P money transfers and online purchasing from merchants around the world.

The network will be running on the GRAM token, which would be used both for payments inside and outside the platform.

The ICO was a closed one and it managed to rake in $1.7 bln. According to Durov, unless the network is launched by October 2019, investors will be able to get their funds back.

About author

A news writer covering blockchain and crypto spheres, writes for various media outlets
Sign up for our Newsletter